Financial separation is not instantaneous during divorce. Spouses often spend months negotiating with one another or waiting for a judge to review and rule on their disagreements.
Frequently, when one spouse intends to remain in the marital home while the other leaves, refinancing is necessary. What is the usual timeline for refinancing a mortgage assumed during marriage as part of a divorce?
Refinancing is often one of the last steps
Typically, spouses continue to share ownership of their home and responsibility for their joint mortgage until the courts enter a final property division decree. At that point, the spouse staying in the home has the documentation necessary to begin the refinancing process.
The spouse leaving the home and potentially receiving an equity payout likely needs to sign a deed once there is a final property division decree validating their right to a portion of the equity. After recording the deed and updating title records for the property, the spouse remaining in the home can then move forward with refinancing.
They can remove the other spouse from the note for the mortgage and may be able to withdraw some equity to compensate them for their interest in the property at the same time. Even if cash out isn’t necessary, refinancing is an important part of establishing sole ownership after the divorce. It may be several months after the final divorce decree before the refinancing process is complete.
Both those keeping the home and those expecting a payout for leaving need to understand the rough timeline for resolving real estate matters after a divorce. Reviewing marital property with a family law attorney can help spouses understand what to expect as they negotiate property division settlements and begin planning to rebuild their lives after a divorce.