Dealing Marital Homes and the Outstanding Mortgages on Them in Maryland Divorce Cases

In a divorce where there are no minor children, possibly the biggest single thing that you’ll need to address is the marital home. One spouse may desire to stay in the home, but that can be challenging if the home isn’t paid off. Certainly, you don’t want to be liable for a mortgage loan securing a home that the court distributed to your ex-spouse. These things point out an important fact: in a divorce, it’s not just getting the assets you deserve, it also about escaping liabilities that you shouldn’t have. When it comes to doing these things, a skilled Maryland divorce attorney can help you protect yourself.

The courts, as we can see in a recent divorce case from Howard County, have substantial discretion in customizing an order dividing up a divorcing couple’s property and debts. The judge is free to award the marital home to one spouse but also to command that spouse, if the house is not paid off, to refinance or otherwise remove the other spouse’s name from the mortgage loan on the property.

So, what happens if s/he gets the house but then doesn’t refinance it? Typically, the court will, within its order, provide specific instructions about the refinancing. The order will give her a deadline by which s/he has to get your name off the loan, and will state what happens if s/he doesn’t act or doesn’t get the task completed by the deadline.

For example, in that recent Howard County divorce, the judge gave the marital home to the wife. The court ordered her to refinance or otherwise remove the husband’s name from the mortgage within 12 months. If she didn’t comply with that requirement, then the court could appoint a trustee who would then sell the home.

16 months after the divorce, the wife still hadn’t refinanced. If you’re in that kind of scenario then you’ll need to file, as this husband did, a request asking the judge to find your ex-spouse in contempt of court and to appoint a trustee to sell the property.

Of course, that may still not be the end of the legal steps required. The trustee in the Howard County case attempted to sell the house, but encountered serious roadblocks. Those roadblocks stemmed largely from the fact that the wife was still residing in the home, and she was giving the trustee “resistance.” When that happens, there may need to be an additional court order forcing the ex-spouse to vacate the residence, in order to facilitate getting the home sold.

What happens if I have the home but no lender will refinance the mortgage?

On the other hand, let’s say you’re the spouse who gets the house that’s subject to a mortgage. In that position, you could face many challenges, too. If your marital home is “underwater” (meaning it’s worth less than the outstanding balance on the mortgage,) then you may find that no lender is willing to refinance the property. If you’re in that position, it is important to seek legal counsel and also to keep all the evidence (both electronic and hardcopy) of your efforts to refinance. That way, if you are hauled into court for contempt, you can prove that you did not willfully disobey the court order.

Divorces involving minor children can often be complicated, but, sometimes, the ones without minor children may be quite complex, as well. That’s especially true if there’s a marital home with significant mortgage debt on it, and one spouse wants to keep that house. Whatever challenges your divorce presents, look to the experienced family law attorneys at Anthony A. Fatemi, LLC to provide you with the helpful advice and strong advocacy you deserve. To learn more about how we can assist you, contact us at 301-519-2801 or via our online form.

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