I've read many posts where people are selling or losing their homes. Yes, I know that now it has become simply a house, four walls and a roof, without your spouse but you may be able to keep it.
Ok, so many of you with houses have probably purchased or refinanced your home by now at interest rates that have made it affordable to you. Refinancing at today's rates will make it unaffordable. There is an alternative and its how I'm keeping my house.
Its called Mortgage Assumption. Instead of refinancing your home you can simply assume the mortgage into your name without a refinance and at your current interest rate. Your spouse will sign a quit-claim deed to you at a "mini-closing" Your ability to afford this transaction will be based on your own personal debt to income ratio. Your spouse's will not count against you. So if your spouse carries the majority or even a significant amount of your debt, it will free up a lot of space for you. You can't even begin the process until you have at least filed a mediated divorce wit the court or have a final judgment signed but after that, they consider who was assigned what debt in the divorce proceeding and will determine if you can afford it. Another important factor is how much equity your home has and whether or not you will be "buying it out" from them at the closing.
If you've already been managing the mortgage payment on your own for a long period this will weigh heavily in your favor.
In my case, we have almost no equity in our home and my wife carried most of our debt in her own name from before we even married. So this is a viable option that we have agreed on.
Call your mortgage holder and find out if this might be an option for you because it beats having to sell!
Good luck,
Peter
