Going through a divorce in Illinois can be stressful, but figuring out what to do with your home doesn’t have to be. If you share a home mortgage with your soon-to-be ex, you have a few different options.
Options for your home mortgage
Selling your property and dividing the income is one option you and your spouse have during a divorce. This option can be beneficial if you have been paying on your home for a while and have built up equity. You can use your share to pay for expenses associated with buying a new home.
Additionally, some banks may offer a mortgage assumption. This is like refinancing in that your spouse is released from all responsibility for paying on the mortgage, but they may not qualify to buy another home.
Benefits of refinancing your mortgage
There are a few key benefits to refinancing your mortgage before the divorce is finalized. First of all, you will be removing your spouse from the mortgage, so the property will only belong to you.
You may also get a lower interest rate when you refinance your home mortgage. This can lower your monthly payments making the home more affordable.
Additionally, you may also be able to get extra money by using some of your home’s equity. Divorce is often a financial burden on couples, and the extra money can be useful for unforeseen expenses.
How to refinance your home mortgage
You should start with your current lender when seeking to refinance. In most cases, you will be subject to qualifying for the refinance as if it were a new home loan. This means that you will have greater luck if you have a good credit history, and all past home mortgage as well as other bill payments have been made on time.