For couples in North Dakota getting a divorce, the division of property is a major concern. It is important that it be done properly, to avoid unnecessary complications later.
Here, for example, is one cautionary tale. When one couple got divorced, the wife was to stay in the family home, as agreed, and to pay the mortgage, which she was financially able to do. The divorce settlement mandated that the husband was no longer liable for anything connected with the home.
Subsequently, when he tried to purchase a condo unit for himself, he found out that his name had stayed on the mortgage for the home. This occurred despite notifying the mortgage lender of the terms of the divorce settlement and transferring the deed to the property to his ex-wife. The bank wanted the ex-wife to reapply for a new mortgage solely in her name in order to take the ex-husband’s name off the existing mortgage, and wanted to charge her approximately $5,000 in fees to do it.
Obviously, the whole thing needed to be sorted out in more detail before the divorce was finalized. With a family home, there are numerous other scenarios, such as when both spouses want to sell and a sale results in a profit. Then it is relatively easy to just pay off the existing mortgage and split the remainder. It is important, however, to also sort out the tax consequence first.
Things are messier if there is more money owed on the existing mortgage than the home is currently worth. Sometimes, it may be best for both spouses to leave the home and for it to be rented out if that is economically viable. In such instances, it is important to have a detailed agreement as to how that is to be done.
There are other variations. Your divorce lawyer has seen many of them over time, and can best advise you as to how to approach this issue.
Source:
Reuters, “Splitsville? How to divide property in a divorce” Geoff Williams, Oct. 07, 2013
