When Texas couples in Texas divorce, there are several financial and personal matters that need to be addressed. For example, couples who have children will have to make decisions about child custody, visitation and child support payments. Another area of consideration is the division of assets and debts. Couples who own a home will have to negotiate several issues, including whether one party will choose to remain in the home, whether the home will be sold and what will happen to the existing mortgage.
When a couple buys a home, the mortgage lender issues the loan on the basis of the income and credit of both parties. Contrary to what many people think, divorce does not automatically terminate the existing mortgage. The mortgage lender will continue to hold both parties responsible for paying the mortgage until the home is sold or one of the parties refinances the home in his or her name only.
Unfortunately, refinancing can sometimes be a difficult task, even if the couple is in agreement as to the terms of the property settlement. This is because a divorce can often negatively affect an individual's finances and credit. While the negative impact is often temporary, lenders may not be able to offer terms that are as favorable as those contained in the original mortgage.
Some couples whose marriages are ending decide to remain in the house due to the economic difficulties of starting over again. This is especially true when young children are involved. A family law attorney might offer other suggestions to a client who is in this position and who is unclear as to how to proceed.