How to pay a mortgage correctly when spouses divorce

Who pays the mortgage after divorce?

A divorcing couple faces a huge number of questions. The purchased home becomes collateral for the loan; how can it be divided? Who, husband or wife, will pay the mortgage after divorce? In what parts?

It is impossible to answer definitively who pays the mortgage after a divorce. And there is no single scheme for dividing obligations for debt and a mortgaged apartment, because many nuances must be taken into account in each specific case. Another difficulty is that the benefits of everyone should be taken into account: husband, wife and bank. If, when dividing an apartment that is not burdened with mortgage payments, it is enough to only come to an agreement between the spouses, then finding a solution that suits everyone is much more difficult in this situation.

What happens to the mortgage when spouses divorce?

If the former spouses are co-borrowers of the mortgage and one of them refuses to pay the loan installments after the divorce, the debt entirely “hangs” on one of the spouses. In case of divorce through the court (not by consent or in accordance with the marriage contract), the judge will in any case divide the apartment in half, regardless of who has the mortgage loan.

If this happens and someone refuses to pay their share of the money on the loan, the ex-husband or wife can be sued for compensation for expenses incurred due to the refusal to jointly pay off the loan or demanded to divide the loan apartment according to the funds paid for the loan, for example, not 50 by 50, and 60 by 40.

Co-borrowers can either change the mortgage agreement with the consent of the bank and share responsibility for repaying the loan in parts, or re-issue the mortgage loan to one of the co-borrowers.

What does the law say about paying off a mortgage in a divorce?

The discrepancies in the division of credit housing are explained by the fact that the legal settlement of the issue in civil and family legislation seems insufficient. The court necessarily relies on the provisions of the Family and Civil Codes, the Federal Law “On Mortgage” and documented relations between the bank and the spouses.

The Mortgage Discharge Act makes it clear that property acquired by spouses while they were married on credit is community property. Which implies certain legal consequences, namely:

the marriage contract was not concluded - then the law prescribes dividing the apartment in half into equal shares;
If housing purchased on credit is divided, then the division does not take into account whose name is on the loan agreement - a divorce with an unpaid mortgage leads to continued payment of the debt by both spouses.

Mortgage taken out before marriage

The question of who will pay the mortgage during a divorce does not arise in this case. The law gives a clear answer: real estate that was purchased before the wedding is the property of the person who bought it. Payment of debts falls on the shoulders of the spouse who owns the apartment.

There are some peculiarities here. Since the loan is repaid over many years, part of this amount could have been contributed from the family treasury. In the event that the spouse who owns the apartment in the mortgage cannot provide evidence and confirm that all payments were made from his own funds, the other spouse may demand the return of half of the amount. The law gives only one answer: this decision is made by the court.

Arbitrage practice

The case was heard at court district No. 1 of the Duvan district of the Republic of Bashkortostan in July 2011.

The ex-husband demanded in court to reduce the amount of alimony he paid in favor of his son from his first marriage to one-sixth of his earnings and to completely free him from maintaining his ex-wife. The plaintiff substantiated his claims with the following facts:

He entered into a new marital relationship, in which the plaintiff had a child. Due to the fact that the wife is on maternity leave, the plaintiff is forced to support her and the child on a monthly salary of 14,500 rubles.
In addition, the plaintiff is obliged to pay a monthly mortgage of 6,620 rubles, a consumer loan in the amount of 1,400 rubles. and utilities 2,000 rubles.
Based on the above circumstances, the plaintiff believes that a child from a second marriage is less wealthy than a child from a first marriage, because the ex-wife has a husband who provides for her and the child.
He also stated that he was not obliged to support his ex-wife due to the fact that they were in a marital relationship for a short period of time, namely less than 1 year.

The defendant made objections, the meaning of which was as follows:

The plaintiff is wrong in asserting that the defendant’s financial security is better than his. The plaintiff’s income structure consists not only of wages, but also of unofficial earnings. In addition, the plaintiff’s second wife owns a car and additionally receives child benefits.
Satisfaction of the claim will lead to the fact that the plaintiff’s children from different marriages will not be provided for equally.
The rule on the short duration of marriage does not apply to able-bodied persons, which includes the defendant, who worked as a lawyer before her maternity leave.
The defendant's second husband, by law, does not have to provide for her child, because the second husband did not adopt him.
She has no income due to maternity leave, and she does not receive child support, so alimony is the only source of funds.

Following the trial of the case, the judge decided to refuse the plaintiff for the following reasons:

It is impossible to reduce the amount of monthly alimony collected for a child from a first marriage, because in this case he will be in a less secure position than a child from a second marriage.
The plaintiff has a higher income and owns more expensive property than the defendant, and is thus in a better financial position. This is confirmed by information from the tax office, extracts from Rosreestr (availability of a 2-room apartment), certificates from the traffic police (availability of a foreign car for the plaintiff and Lada Priora for his second wife).
The plaintiff's second wife, according to a certificate from her place of work, actually receives child benefits.
The mortgage loan is paid not only by the petitioner, but also by his second spouse, with whom the petitioner shares both a common budget and common expenses.
The defendant does not receive any child benefits and is on maternity leave, which is confirmed by a certificate from her employer.
The rules on the short duration of a marriage or on the entry of an alimony recipient into a new marital relationship apply only to the category of disabled citizens, to which the defendant does not belong.

Children

According to current legislation, children under the age of majority do not affect the division of debt. But at the end of 2019, a draft amendment to the Family Code was submitted to the State Duma, which proposes to strengthen the protection of children when their parents divorce. This bill also contains recommendations on the payment of a mortgage during a divorce - if the parent with whom the child remains cannot fully pay the mandatory payments, then the second parent will be required to increase their payments in order to provide the child with living space. If there is a division in the future, the court will definitely take into account the presence of children.

How to pay a mortgage after parenting spouses divorce:

if the child owns his own part of the apartment, it will be added to the share of the parent with whom the child remains;
if the spouse does not have another home, the minor child will live with her and has registration in the apartment, which is owned only by the husband: in this case, the wife has the right to her share of the real estate;
the spouse with whom the child will live may receive a larger share of the apartment or house, but the payments that he will be required to repay will be larger;
a minor must be discharged if the housing is planned to be sold;
If, after the divorce, the son or daughter remains with the mother, and she is unable to fully pay the required amount (maternity leave, disability, health condition), the amount of the monthly payment is temporarily reduced for her, and the missing part will be paid by the spouse. There should not be a complaint that the husband does not pay the mortgage after the divorce - all decisions, according to current legislation, are made by the court.

It may happen that loan payments are overdue - in this case, neither the presence of children nor their registration affects the procedure for collecting the loan collateral.

Options for solving this problem

Spouses who have decided to divorce and are co-borrowers on a mortgage obligation must:

Conduct mortgage payments as usual . without changing the conditions for the return of funds and ownership of the premises. In this case, the spouses, after informing the bank, make payments according to the previous rules;
Apply for the transfer of property rights to only one spouse. In this case, it is necessary to apply to the banking organization with an application to transfer the debt to one of the spouses. If the application is satisfied, the bank draws up an additional agreement, which specifies the rights and obligations of the sole borrower, and also establishes a new frequency of payments and their amount;
Divide the ownership rights to real estate in court . as well as obligations to repay mortgage debt. To do this, you should file a civil lawsuit in court asking for the division of joint property. During the hearing, the court, based on the ratio of the spouses’ shares in property, will establish the procedure for subsequent payment of mortgage payments;
Pay off your mortgage early and then sell the property. Having chosen this way of resolving a controversial situation, please note that until the debt is fully repaid, the sale of property is unacceptable, since the property has the status of encumbered;
Refuse to fulfill obligations and wait for the property to be sold at auction by a banking organization. In this case, the encumbered apartment will be sold by the banking organization independently. The money received from the sale of real estate will be counted towards the repayment of the mortgage.

Regardless of the decision made, spouses must inform the banking organization about the divorce.

Notify the bank about the divorce and what determines the division of the mortgage

If you decide to get a divorce and you have a mortgage, then you need to start by informing the bank where you took out the loan.
The credit institution itself will offer you options for dividing the apartment and mortgage debt. The spouses no longer want to live under the same roof, but the roof itself cannot be divided. It's all about the nuances here.

When did you purchase the property: before the wedding or after?
Was the marriage officially concluded, or are we talking about cohabitation without paperwork?
Was there a prenuptial agreement?
Who is the loan issued to?

This issue usually does not require going to court. You need to go to the bank as quickly as possible and decide what will happen to the apartment, who will get it and who will pay the payments. But in judicial practice there are cases when a spouse says that they also want a share in the apartment, although they have not paid a single payment. We tried to answer this in this article.

The mortgage was taken out before marriage

When real estate is acquired before marriage, the family code defines it as personal property. It cannot be divided. But there are nuances. When common money was invested in this property, or the second party repaired the property and contributed to increasing its market value, its interests will be taken into account by the court. This means that real estate acquired before marriage can be divided in court.

Reader's question

“I took out a mortgage on an apartment while I was unmarried. After that I got married, the marriage lasted 5 years. They filed for divorce. Now the husband demands a share in the apartment. Is this legal?

Lawyer's answer

"Yes, it is quite. All income of the husband and wife is considered joint. Even if the spouse did not work, and the spouse made payments on the loan, her income is also considered common: this is the family budget. This means that the husband can claim the property as a co-owner.”

Theoretically this is true, but in practice the court will definitely find out all the circumstances.

Was there a good reason why the husband did not work?
Did the spouse really pay the contributions? They look at the accounts.
What housework did your spouse do? Maybe he did a major overhaul with his own hands?

Depending on the circumstances, the ex-husband may receive a share in the apartment, or compensation for his contribution. If he receives a share, the loan payments will be calculated in accordance with his part. The husband received half and will pay half of the monthly payments.

If the mortgage is issued for two spouses

There are often situations when spouses bought an apartment with a mortgage for two and are now getting divorced . What are the options?

Does one spouse wish to give up his share in favor of the other with or without additional payment?
Will the bank allow the division of real estate and payments on it? The apartment is actually owned by the bank, any manipulations occur with its consent. Payments can be divided between spouses, so that everyone pays their part for themselves.
The property is sold after paying off the entire cost of the debt. The funds are divided between the spouses, in accordance with what shares will be assigned.

If one of the spouses refuses the apartment, it is completely transferred to the use of the other party. All payments are made by the owner. This can be done free of charge, or taking into account compensation for your share and payments made. The amount will be determined by the court.

An apartment taken on a mortgage can be divided between spouses only after full payment of the debt to the bank . Then the spouses have the right to dispose of their shares as they wish.

The spouse can pay for his share, or the apartment can be sold as a whole and the funds divided. You cannot sell an apartment for which the mortgage has not been paid . Only the bank itself can do this.

If the mortgage is issued during marriage to one of the spouses

How to divide an apartment in a mortgage during a divorce if it is registered in the name of one of the parties? The spouse who is not a co-borrower is not required to pay contributions, but has the right to the apartment.

The court makes a decision based on the circumstances of the case.

Do the spouses have children?
Who made the payments?
Were repairs carried out and at whose expense?

These and other circumstances influence the judge's verdict. If the owner paid the contributions on his own, his legal spouse can also count on getting a share. Common children who are registered at the place of registration in this property will also receive a share as direct heirs. Accordingly, it can be divided into three parts. And the payments will have to be paid in half.

If one of the spouses made payments or made repairs, the court may order the owner to pay compensation. But this fact needs to be proven. To do this, they bring witnesses, checks, and bank card statements to track payments.

In marriage, husband and wife share everything equally: this is enshrined in law. Let only one person appear in the contract, this is a formality. All acquired property is considered common. Therefore, the court will divide the apartment into parts. The only question is what these parts will be.

When does one of the spouses want to keep the apartment for themselves?

If the husband pays his wife the value of her share, and she agrees to this voluntarily, the property completely becomes his property. So is mortgage debt. This can be done through negotiations. Also, if the marriage contract prescribes such an outcome in the event of divorce, you can do without negotiations.

Draw up a marriage contract

Lawyers strongly advise thinking through in advance the situation in which you will have to share an apartment. All conditions specified in the marriage contract will be fulfilled, provided that the husband and wife have signed it. If it states that the apartment completely belongs to the husband, it will be useless for the wife to go to court. Here the court is guided not by the law, but by the marriage contract. The contract must be signed by a notary.

Refuse to pay your mortgage to the bank

Can one of the parties refuse obligations to the bank? If during a divorce there is a mortgage on the apartment, the defendant often states that he is not going to pay for a place where he no longer lives. Then the contract is completely re-signed to the other party. All mortgage payments fall on the shoulders of the other party. refuses to make payments, he also renounces his claims to own the property .

If both parties declare that they will not pay for this apartment, it is sold, as a rule, for next to nothing. The amount is deliberately reduced in order to quickly sell the property in the shortest possible time. The amount is set to be enough to cover the debt to the bank. The spouses are deprived of their property.

Changing the terms of the loan agreement

There are several ways to remove a co-borrower

Voluntarily, when contacting a banking institution with a corresponding application. In this case, the main borrower needs to find an additional second co-borrower instead of the retiring one. The retiring spouse, in turn, must express in writing his consent to withdraw from the obligation; this consent must be certified by a notary. If the banking organization agrees, as previously indicated, an additional agreement will be drawn up that will meet the new conditions;
The issue of distribution of obligations can be resolved without the participation of a credit institution. To do this, you must go to court. After the court’s decision has been made and it has entered into legal force, you should apply to the Russian Register for the issuance of a new certificate of ownership. The basis for issuing a new document will be a court decision. Next, with a court decision and a new certificate, you should contact the bank with an application to change the terms of the mortgage agreement.

Re-registration of rights to real estate

Since ownership of the mortgaged property is registered until the encumbered loan is fully repaid, the co-borrower spouses cannot independently implement the procedure for re-registration of rights to the property.
In order to re-register property rights, the bank's consent is required . In this case, the bank will issue an agreement in which, instead of the previous co-borrowers, the data of only one spouse (the main borrower) will be indicated. This document will be the basis for the registration authority to re-register ownership and issue a corresponding new certificate of ownership. In this case, the property will continue to be under encumbrance.

Another option for re-registration of property is a court decision . For the registration authority, it is also the basis for entering new data about the person recognized as the owner.

Maternal capital

In order to purchase an apartment, funds from maternity capital could be used. Since they resorted to money from the state, division may cause certain difficulties.

The latter’s share will be added to the living space of the spouse who takes care of the child, since it is paid for from maternity capital. Mortgage payments in a divorce will be divided equally between everyone, unless nothing prevents this.
If a divorce occurs with an unpaid mortgage and the child has not yet received his share, the court imposes an obligation on both parents to realize the rights of the child after all payments have been made.
The marriage is dissolved. Now the wife can pay off part of her debt or the entire amount at the expense of maternity capital. It is impossible to use the apartment until the loan is repaid in full.
It is impossible to sell shares of an apartment and divide the proceeds if maternity capital was used. Since children cannot be evicted and deprived of housing, the transaction will not be recognized as legal. If spouses deliberately violate the law, the court will oblige them to return the monetary equivalent of what was spent to the budget.

Military mortgage

If the apartment was purchased by a serviceman and his spouse, who pays the mortgage in the event of a divorce?

The division of such housing is not permitted by law. The apartment was not purchased by one of the spouses, but with designated funds. That is why it remains the property of the military. The spouse who entered into the loan agreement will remain both responsible for the loan and the payer of the unpaid funds after the divorce. In this case, it is not possible to split mortgage payments after a divorce.

Division of property during divorce: mortgage

When dividing property, such housing should be divided in half between both spouses. However, since the apartment is pledged to the creditor bank, the bank must agree to the division. In addition, you may be required to reissue the borrower's insurance and the mortgage loan agreement itself.

As a general rule, each spouse can claim property acquired during marriage in equal shares, unless otherwise provided by the marriage contract.

How to divide an apartment during a divorce when the apartment was purchased with a mortgage that has not yet been paid off

How to get a divorce in a “civilized” manner if the mortgage was issued for two? A “civilized” divorce can only take place in one case – by mutual consent, without the participation of the court. A husband and wife can divide the apartment and mortgage payments into equal or other parts; one of the spouses can renounce his share in the real estate for free or for compensation. Then the second spouse, having received 100% of the apartment, will have to pay the entire mortgage. Having renounced your share in the apartment, you need to contact a creditor - he will transfer your part of the debt to your ex-husband or wife.

Mortgage loan after divorce. Who pays?

33). An apartment purchased, albeit on credit, still becomes family property, that is, joint property.

The Federal Law “On Mortgage”, adopted in 1998, does not directly establish any restrictions on the division of such property; Article 7 only states:

“on property that is in common joint ownership (without determining the share of each owner in the right of ownership), a mortgage can be established with the consent of all owners.

Pre-trial procedure

If the spouses want to calmly resolve among themselves the issue of how to pay the mortgage during a divorce, they can jointly decide how to divide the apartment and the unpaid loan debt without bringing the matter to court. In the presence of a lawyer, an agreement is drawn up on how the shares of housing and the debt for payments for it are calculated after the dissolution of the union. The notary is an indispensable witness - he certifies the transaction. Paying the mortgage during a peaceful divorce will not be a problem for any of them. In such situations, the permission of the creditor bank to change the loan agreement is mandatory.

Payment of compensation

Let's consider how a mortgage on an apartment is paid during a divorce if a married couple or the court decides to transfer the apartment to the full ownership of one of the spouses. There is no division of the mortgage; all mortgage payments after a divorce go to the spouse who becomes the sole owner. The other half has the right to claim compensation. It is defined:

independently by wife or husband;
market price;
funds that have already been deposited are taken into account.

By agreement of the parties, compensation is paid one-time in the entire amount, or in equal parts over an agreed period of time until full repayment.

How can I sue my ex-husband for a share in the mortgaged apartment if I am the only one making all the payments?

How can I sue my ex-husband for a share in the mortgaged apartment if I am the only one making all the payments? We took out a mortgage for an apartment a year ago, the down payment was the same. A year later they divorced and my husband left for another city. I pay all mortgage payments. The apartment was purchased as jointly acquired property; shares were not allocated. What to do in this case?

Lawyer's comment

The issue of division of mortgage obligations during divorce is regulated by the following regulations:

Family Code of the Russian Federation;
Civil Code of Russia.

Thus, in accordance with the norms of family law, any property acquired during marriage is the common property of the spouses. In the case of judicial division of common property between spouses, debts that were incurred during family relationships are also subject to division. Civil legislation contains a rule according to which the division of a mortgage obligation between spouses is possible only with the consent of the credit institution.

The apartment is jointly acquired property and belongs to both spouses by right of joint ownership, regardless of who the documents are issued to. When dividing by court, the apartment will, as a general rule, be divided in half.

The mortgage loan will be a joint obligation and, by law, will have to be divided between the spouses in accordance with their shares in the common property, that is, as a general rule, in half. In practice, the court leaves the debt with the actual borrower, and from the second spouse awards payment or reduces the property in the amount of half the debt.

Since the loan is secured by a mortgage, any transactions with the apartment are possible only with the permission of the bank; transfer of debt in accordance with the Civil Code of the Russian Federation is also possible only with the permission of the bank.

If the former spouses are co-borrowers of the mortgage and one of them refuses to pay the loan installments after the divorce, the debt entirely “hangs” on one of the spouses.

In case of divorce through the court (not by consent or in accordance with the marriage contract), the judge will in any case divide the apartment in half, regardless of who has the mortgage loan. If this happens and someone refuses to pay their share of the money on the loan, the ex-husband or wife can be sued for compensation for expenses incurred due to the refusal to jointly pay off the loan or demanded to divide the loan apartment according to the funds paid for the loan, for example, not 50 by 50, and 60 by 40.

Co-borrowers can either change the mortgage agreement with the consent of the bank and share responsibility for repaying the loan in parts, or re-issue the mortgage loan to one of the co-borrowers.

If the financial capabilities of each spouse allow them to take out an individual loan, then the bank will most likely reissue the agreement and replace joint liability for the mortgage loan with individual liability.

If an individual agreement is drawn up for one of the former spouses, then the second spouse is deprived of the right to apply for a mortgage apartment.

If one of the spouses does not want to make concessions, then the matter can only be resolved through the court.

You can file a claim for division of marital property. Ask the court to transfer the apartment into your ownership, with payment of compensation to your ex-spouse. The compensation will consist of half the down payment on the mortgage and half of the payments during the marriage. Next, you will already be paying a mortgage for your apartment. If you do not change the terms of the mortgage agreement, you may not even need to involve the bank as a third party in the lawsuit.

In order to re-register property rights, the consent of the bank is required. In this case, the bank will issue an agreement in which, instead of the previous co-borrowers, the data of only one spouse (the main borrower) will be indicated. This document will be the basis for the registration authority to re-register ownership and issue a corresponding new certificate of ownership. In this case, the property will continue to be under encumbrance.

Another option for re-registration of property is a court decision that has entered into force. For the registration authority, it is also the basis for entering new data about the person recognized as the owner.

If you don't pay

One of the spouses may stop paying rent if it is not possible to reach an agreement on how to pay the mortgage during a divorce. The second spouse will be forced to pay the loan for the apartment independently and pay the full required amount every month.

If neither spouse pays rent, the amount of debt will increase. If there is no payment within four months, the bank has the right to put the apartment up for auction and withdraw the funds received to offset the debt.

Is it possible to sell a mortgaged apartment during a divorce?

Re-read the loan agreement and check with the bank whether you have the right to sell the property. This is a rather radical method, but effective.

You sell your home, repay the bank loan ahead of schedule from the amount received, and if there is some amount left, divide it between the spouses. In this case, you immediately get rid of your obligations to the bank, and also have a better chance of resolving your housing issue peacefully with a minimum number of claims. In one case or another, one of the spouses will bear the majority of the financial responsibility if they decide to keep the mortgage.

The procedure is not so simple, but it is quite possible:

1. You inform the bank about your decision. The credit institution gives the go-ahead for the sale of the apartment.

2. The buyer deposits the amount remaining under the contract into the bank. The bank removes the loan encumbrance from you.

3. The new owner of the apartment pays you the balance, which you divide.

In this case, it is better to contact real estate professionals. Most often, a bank can provide such specialists.

Also, a credit institution can assume obligations for the sale of an apartment. Then the bank puts the property up for auction, but the cost of housing may drop significantly. In addition, you will have to pay separately for the auction procedure.

Solutions

In fact, there are not many ways to resolve the situation with paying a mortgage during a divorce. Spouses can:

distribute the apartment and fees for it among themselves;
continue to pay money together, adhering to the same conditions;
repay the loan early and put the apartment up for sale after full payment;
do not pay anything, and the bank takes the apartment and sells it through an auction.

Everything is very clear when it comes to paying off debt. But the other options are not so transparent. How is a mortgage paid during a divorce?

Why do banks object?

The bank is the third party whose interests are taken into account in the event of a divorce with an unpaid mortgage. The Family Code clearly states that upon separation, both the family debts of the spouses and their real estate are divided. The Civil Code states that this is quite possible, but the approval of the lender is required. And the overwhelming number of citizens trying to divide real estate and payment for it among themselves will not receive consent from the creditor. The reason is simple: in the case of dividing the obligations to pay off the debt, the liability of the spouses becomes shared and not joint.

To explain it differently, the bank will not be able to demand the return of the entire amount of debt from the former couple. This is unprofitable for the bank and therefore does not suit it at all. And spouses, having received a refusal, can file a claim only once - going to court a second time is unacceptable. According to banks, the mortgage must be paid off after a divorce.

How is the apartment divided?

If, upon separation, the spouses also share an apartment taken on credit, there are several possible ways out of this situation:

Try to come to a peaceful resolution of the issue and a solution that suits both. If this option is unacceptable, a claim is drawn up and filed in court.
The bank is informed that the spouses have officially terminated their relationship. If an agreement is reached on the apartment and the loan debt, it is submitted to the bank for approval. If you are not satisfied with this option, finding a compromise that suits all parties seems to be the best way out.
If the parties have agreed on what fate awaits the apartment and how to distribute loan repayment obligations, they turn to a notary to certify the agreement.
Afterwards, both spouses fulfill everything they agreed on. Upon completion of all payments, the ex-husband and wife receive a loan agreement. The sale of the apartment is now possible.

The path of a peaceful settlement seems to be the most beneficial. Through negotiations, you can come to a common decision and not complicate life with unnecessary conflict.