Spousal Buyout Mortgage
Getting divorced or separated and need to know what to do with your mortgage?
Approximately 38% of all marriages are ending in divorce, and while it is a sad statistic, it is a very realistic one. This means there are more homebuyers than ever before in need of a Spousal Buyout Mortgage.
Most people think when getting separated or divorced that you need to sell your house. But that’s just not true! Another common misconception is that to access the equity in your home and buyout your spouse you have to refinance with your current bank. But that is also not true… here are some options.
This program is designed to allow one spouse to “purchase” the property from the other spouse thereby allowing you to borrow up to 95% of the property value instead of just 80% with a refinance.
This can mean the difference between being able to keep your home, or being forced to sell your home. It is a game-changing mortgage product for couples deciding to separate or divorce.
How does it work? For example, if you have a house worth $500,000 and you owe $400,000 and need to pay your ex $50,000 as a buy-out, then you need to realistically borrow approx. 90% of your home’s value ($400k mortgage plus $50k buyout = $450k, or 90%). In the past or with banks, you only had the option of refinancing and the most you could borrow was $400,000 or 80%. Well this wouldn’t be enough to buy out your ex and retain the property so you may have been forced to sell. But not anymore with this spousal buyout program! I’ve helped dozens of couples in often trying times sort through their options and help reduce the financial stress during separation or divorce.