With one of the highest foreclosure and mortgage delinquency rates in the nation, Florida homes have suffered devastating losses in equity over the past three years. So it’s no surprise that many Florida couples in the midst of a divorce no longer argue about who gets to keep the house – rather, the argument becomes about who has to keep the house.
Many divorcing Florida homeowners now face the possibility of being tied together not because of the children but because of the negative equity in their homes. This is because, from a lender’s perspective, both spouses are still responsible for the loan, married or not. If one spouse can qualify for a mortgage modification or refinance on their own, problem solved. However, in today’s current economic climate, this is a very big “if”.
Keep in mind, if your spouse cannot qualify for a refinance or mortgage modification without you still on the mortgage and note, do not think a quitclaim deed will absolve you of any responsibility. It will not.
Even if there is some equity still remaining, divorcing spouses will likely find it difficult to get at it when dividing assets. One spouse may find it necessary to “reimburse” the other over time as part of their divorce agreement.