Are you in the market for a new home and also a Veteran? The good news there are tons of benefits that come with using a VA loan. The Gifford Group can help you with your home search
Can I Purchase A New House Before My Divorce Is Over?
Dated: January 30 2021
There is no one-size-fits-all on this topic. Getting a divorce is a stressful time as your life is being flipped upside down, and now you might not have a place to call home or a place that you want to stay. Buying a house before divorce is final is an option, but let's go over the potential issues you can run into.
First, there must be no court-imposed restrictions. Don't just go out and purchase a new property as any money used to purchase a new home may be considered marital assets. You will need to speak with your lawyer to find out if you need court approval to buy a home while divorcing. The Gifford Group can help you during all stages of divorce, as we have relationships with Lawyers, CDFA's, Inspectors, Mediators, Counselors, and more.
Second, getting financing for the new home could be an issue. Make sure you can afford the new mortgage. Without the support of your soon-to-be ex-spouse, your income alone will have to qualify for the new loan. Having to pay or wait to receive child/spousal support could affect your ability to qualify for a new loan. If your debt ratios are too high, you might get rejected. We can connect you with a mortgage broker that will help determine if and what you can qualify for.
Third, title companies in community property states will require your spouse to sign and notarize a type of quitclaim deed, disavowing/transferring any acquired interest in the property. When purchasing a new home while still legally married, keep in mind that your spouse will be required to sign a Quitclaim Deed prior to closing. This will allow you to claim sole title to the new property.
What is a Quitclaim Deed?
A quitclaim deed in Texas is a legal way to convey property ownership from an owner to another owner without any warranty or guarantee that the title is clear and free of encumbrances.
Obtaining a quitclaim deed does not remove the spouse from the old mortgage and still leaves the possibility that your credit could get ruined from unpaid loans that your name is still on. Divorce can lead to more debt and lower credit scores. An upset soon-to-be ex-spouse might make obtaining a quitclaim deed difficult or impossible. You might think to buy a new home in the name of a different family member or friend, but we would advise against it. Buying a new home with marital funds before the divorce is finalized could it could be considered community property.
If all those aren't issues, a pre-divorce purchase can be an option.
Contact us today to talk about your options on homeownership.
TheGiffordGroup.net - "Opening Doors To New Beginnings"
Amber’s love for real estate comes naturally. She utilizes her creativity to tell a story of what could be by providing her clients the vision through their own eyes. “I’ve always loved creating....
Latest Blog Posts
Anytime you borrow money there’s a cost for the privilege. That’s no different for mortgage loans, which you rely on during the home buying process.This year we are seeing
There is no one-size-fits-all on this topic. Getting a divorce is a stressful time as your life is being flipped upside down, and now you might not have a place to call home or a place that you want