If you have made the difficult decision to end your marriage, or you have been served with papers indicating that your spouse has made that decision, you are most likely concerned about how a number of issues will be handled in the ensuing divorce. One question many people have when faced with the end of a marriage is “ How is the house handled in a Tennessee divorce? ”
Tennessee is an “equitable distribution” state when it comes to division of property in a divorce. What that means is that if a court must divide the marital property it will try to divide the property fairly. Fair, however, does not always mean equal. For most couples, the marital residence is the biggest asset in a divorce. Who gets the marital residence, therefore, is often a contentious issue. Deciding who gets the house though may not actually be the biggest problem. How the transfer of the house is accomplished is often much more complicated than people realize.
Imagine, for example, a common scenario in which the wife is awarded the marital residence because the minor children will be living with her the majority of the time. When the house was purchased, qualification for the mortgage loan was based on both the husband and the wife’s income. Now, however, the husband needs to be removed from the mortgage debt. That requires the wife to refinance the mortgage loan, a task that may be much harder to accomplish than you realize. All too often the party who is awarded the marital residence plans on using spousal support income to pay the mortgage going forward. The lender, however, may not be comfortable including spousal support as income because there is no history of it being paid on a regular basis. Just because the court orders it doesn’t always mean it will be paid as ordered.
One option is for the husband to remain on the mortgage until the wife can refinance. This, however, can cause problems for the husband if he tries to qualify for a mortgage to purchase a new property because the original mortgage debt will show on his credit, causing a very high debt to income ratio if a new purchase is factored in to the equation.
As you can see, deciding how to legally transfer the marital property from both parties to just one party after a divorce can become complicated rather quickly. For this reason alone it is imperative that you consult with an experienced Tennessee family law attorney prior to agreeing to any type of martial settlement agreement.
If you have questions about division of property or about divorce in general, consult with the experienced Tennessee family law attorneys at Bennett, Michael & Hornsby. Contact the team today by calling 615-898-1560 to schedule your appointment.