Divorce and Mortgage Obligations: Protecting Future Interests
The family home can present many challenges to the smooth resolution of a New Jersey divorce beyond the fundamental issue of who gets to keep the house.

November 19, 2011 /24-7PressRelease/ -- Division of property in a New Jersey divorce is a fundamental part of allowing a couple to move on with separate lives while maintaining as much financial security as possible. Whether the couple is going through a high-asset divorce or has a relatively modest marital estate to consider, both parties have long term interests at stake.

New Jersey family law statutes require an equitable division of marital property as part of the dissolution process, and this includes everything from real property, vehicles and securities to pensions, retirement savings and business interests. The property division process must also factor in outstanding obligations such as credit card debt, auto loans and the largest debt most couples face: a mortgage on the family residence.

The family home can present many challenges to the smooth resolution of a divorce beyond the fundamental issue of who gets to keep the house. The amount of equity is an asset that the parties will want to factor in to their overall consideration of the financial issues of divorce. Assuming that one spouse keeps the home as well as the obligation to continue mortgage payments, the other spouse must still ensure that his or her legal obligation to pay is eliminated.

While a negotiated divorce agreement has legal effect between the ex-spouses, it has no bearing on the eventual non-resident spouse's obligation to the creditor. In other words, absent any change to financing arrangements, both spouses can still be held accountable if mortgage arrears begin to mount and foreclosure proceedings begin. A spouse who was willing to walk away from the family home could suffer serious damage to his or her credit rating even though the other spouse had committed to paying the mortgage.

Because selling the home is not always possible or desirable, the best alternative is to refinance the home in the resident spouse's sole name prior to finalizing the divorce. The complex path to financial independence in a divorce involving a diverse marital estate is one more reason for working with an experienced New Jersey family assets lawyer.

Press Release Contact Information:

FL Web Advantage