Going through a divorce? You can still buy a house. Find out how!

buy house during divorce

Divorces are complicated. Dividing the assets of a divorce is difficult, too. Who gets what? Divorces divide a single household into two; eventually, someone has to leave. At that point, it’s crucial to decide where to live. It’s possible one of the divorcees is looking to buy a home. But can you buy a house while you’re going through a divorce?

It’s really important to gauge your financial situation as you’re going through a divorce. That way, you’ll have a better understanding of what you can and can’t do. It’s also a good idea to consider an attorney, who can help you make decisions that will best benefit you in your situation. They can also help you evaluate potential complications.

Though it may not be the best time to do so, there are ways to make the situation work. Despite some divorce situations, there’s a good chance you’ll be able to get a mortgage, especially if you follow certain steps and are armed with answers to these questions.

  1. Do you have a separation agreement?
  2. Is the separation agreement signed by both parties?
  3. Is the separation agreement recorded in the county you resided in at the time of the separation?
    1. Yes? Can you supply a copy of the first page of the Recorded agreement that indicates the recording information?
  4. Is the Deed to the property in your name?
  5. Do you have a Free Trader agreement?
    1. Yes? Can you supply a copy of the page of the Separation agreement that details with the Free Trader agreement.

At a minimum, without a Free Trader Agreement, which one party releases the other from ownership of a property they buy, the court could decide it’s marital property and try to divide it accordingly.  North Carolina is a martial rights state which means, even if you buy a property when you are unmarried, once you get married, your spouse automatically has a 50% stake in the property — UNLESS YOU HAVE THE FREE TRADER AGREEMENT OR SOME OTHER LEGAL INSTRUMENT.

You Are Legally Separated

If you’re attempting to buy a home while you’re separating from your spouse, you will more likely than not need to give a mortgage lender a separation agreement that’s signed by a judge. Additionally, you may need to provide the judge with a complete property settlement if that’s applicable in your situation. Then, the agreements will be reviewed for financial obligations, and their requirements.

There’s a possibility you may need to involve your spouse, if only for a signature on the loan you’re trying to get. Even if they won’t be a part of the new household, you may still need their signature on the related documents in purchasing the property. Fortunately, your spouse buy house during a divorcedoesn’t need to be on the title of your new home, however, it’s important to make sure they attend the closing with you.

Getting off of your old mortgage (in a shared home prior to separation) isn’t out of the question, either. Using a quitclaim deed you can be removed from the deed of your existing property. This may actually make it easier for you to get a new loan for the house you’re interested in.

But, if your name is on the loan, the only way to remove your name is to refinance the property.

You Are Currently Going Through Divorce

From a legal perspective, it might be a little harder to buy a new home. Unfortunately, the buyer would have to be treated as if they were married still, regardless of the status of their pending divorce. It’s also very likely you’ll need your spouse’s signature on related documents to the new home, including the loan. They will not, however, need to be on the new title yet they will, in fact, need to sign your paperwork.  Remember, that the most important document to have, in addition to the separation agreement, is the Free Trader Agreement.

If you’re paying things such as alimony and child support, these things will be factored into your debt-to-income ratio which may affect buying the home. A divorce decree is useful here, because it outlines all of your payments and financial arrangements.

Real Estate Experts

Overall, a divorce decree is very important because it frees you of the obligation to an existing mortgage. If you have any questions regarding the required documents to pursue buying a new house, please feel free to reach out to us!

We’re experienced buyer’s agents who are prepared to help you find the perfect home for you. As we’re obligated to you, the buyer. So we’ll keep your best interests at heart and work to get you into your dream home quickly!