Can You Change Your Mortgage Terms After a Divorce?

One of the most difficult aspects of divorce is deciding what to do with the house. When one spouse decides to keep the house, the family court may end up deciding who is going to pay for the house and how, but when it comes to the mortgage, the family court's decision means little. The terms are rarely negotiable.

Transferring Interest

In the instance of a divorce in which one spouse decides to keep the house, the spouse who no longer wants any interest in the home will often sign a quitclaim deed or interspousal transfer grant, giving up his interest in the home. There's no such thing, however, as a quitclaim for a mortgage payment; if both spouses are on the loan, both spouses are ultimately responsible for the repayment, regardless of which spouse is living in the home.

Judgments Useless

Many divorced couples assume that because a family court has issued a judgment assigning debt to one person in the marriage that the other's responsibility for that debt is eradicated. Nothing, however, could be farther from the truth, warns Bankrate's Justin Harelik. A family court judgment means nothing to your creditors; if your ex-spouse chooses to keep the house but fails to pay and your name is on the mortgage, you are still responsible for repayment.

Both Parties Responsible

When it comes to a mortgage held in the names of two people, lenders could not care less about which person lives in the house and who is making the payments, as long as the payments are being made. Both people are equally responsible for the loan, despite their marital status or any attempts to take their name off the property. Lenders are unlikely to voluntarily take one spouse's name off a mortgage during a divorce, writes Harelik; doing so leaves the lender without a valuable avenue of recourse should the spouse who keeps the property fail to pay.

Refinancing the Only Option

The only way to change the terms of a mortgage after a divorce is to sell the home or get a new mortgage. "Short of refinancing a property," Harelik writes, "there is no way to get your name off the [mortgage]."

In order to refinance the home, the spouse who wishes to keep the home would require sufficient means and good enough credit to get a loan for the home without piggybacking on a spouse's income and credit.