Going through a separation or divorce?
I’m sure one of your main objectives is just to be able to move on with your life. Your home can be the asset that gives both you and your partner a fresh start. So how do you get started?
Reviewing your numbers with an experienced mortgage consultant is a big part of the conversation around your finances. The value in your home and the power of your mortgage can help you and your partner frame the discussion on what’s to be done with your home. Then, once your separation agreement or your divorce decree are finalized, you will have concrete information on which to base a new mortgage or mortgages.
Questions to answer:
1) Are you hoping to stay in the existing home?
Many couples assume that the house must be sold – but that’s not always the case. Evaluating your financial options with a mortgage professional can help one partner remain in the home. The home can be refinanced up to 80% of its value. You’ll need to determine if this equity can pay off joint debt and provide a payout if it’s required.
Or, one spouse can purchase the home outright from the other spouse who then is removed from the title or ownership of the property. A Spousal Separation Mortgage allows a buyout of up to 95 per cent, which can provide a fair buyout, potentially pay off some or all joint debt, and minimize the required down payment.
2) Do you want to buy a new home?
An experienced mortgage professional can let you know what you can qualify for and what is affordable for you in your current financial situation.
3) Will you need to boost your credit rating?
A less-than-stellar credit rating can affect your ability to get the best mortgage rates. A good mortgage broker will walk you through the best strategies to help you polish your credit, and to build (or rebuild) your credit over time. Click here for articles on credit, including repairing bruised credit or establishing new credit.
Mortgage and divorce
For many separating couples, their home is their most important asset. That’s why seeking the advice of a mortgage professional very early in the process can help set the stage for a successful separation – so the two of you can each make the best possible start on a new path.
Feeling overwhelmed? That’s normal. Don’t be afraid to seek help and advice. Your mortgage broker can help make a challenging time a little more hopeful: with personalized mortgage financing advice. We’ve helped many individuals in these same situations. And there are some great sites out there that can help provide financial advice for you as well – for example, GetSmarterAboutMoney.ca has a good selection of financial information around getting divorced and many other life situations.
If you’d like to review your options, please don’t hesitate to contact me for a no obligation chat. I’m happy to talk to you either as an individual or as a couple. Divorce or separation doesn’t need to spell the end of financial hope. Getting educated about your options enables you to take the steps to move you toward firm footing.
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