Divorce Mortgage Options: Keep the House, Pay Off Your Spouse

Not always. In some cases, you may be able to assume the existing mortgage instead of refinancing. A mortgage assumption allows one spouse to take over the loan while keeping the current interest rate.

However, assumptions aren’t available on all loan types, don’t usually fund a spouse buyout, and still require lender approval. A refinance after divorce is more common because it allows you to complete the buyout, remove your ex-spouse from the mortgage, and satisfy the divorce decree in a single transaction.

There is no universal deadline to refinance after a divorce. Most divorce decrees set a required refinance window—often 30 to 90 days, sometimes up to 6 months, and occasionally as long as 2 years—to remove one spouse from the mortgage. The timeline is driven by financial protection, ensuring the departing spouse is no longer liable for the debt, and by the remaining spouse’s ability to qualify for a new loan.

Refinancing a house after divorce involves reviewing the divorce decree, calculating the required buyout, and applying for a new mortgage in one spouse’s name. If equity needs to be paid out, a cash-out refinance after divorce is typically used to pay the departing spouse at closing.

Because these loans must align with court orders and state-specific rules, applying early matters. Working with LendFriend Mortgage from the start helps ensure the refinance is structured correctly and closes on time, reducing delays that can jeopardize divorce deadlines or force a sale.

If you are required to refinance after divorce and do not, both spouses may remain legally responsible for the mortgage even if one no longer lives in the home. This can impact credit, limit future borrowing ability making buying a home down the road more difficult , and put you out of compliance with the divorce decree. In some cases, failing to refinance can trigger legal enforcement or force the sale of the property.

Refinancing or otherwise resolving the mortgage obligation is usually necessary to achieve a clean financial separation.

Yes. The spouse keeping the house must be able to qualify for the new loan individually—based on their credit, income, and debts. We can help you calculate your buying power before finalizing your divorce agreement.

Yes, in most cases you need a signed divorce decree to remove a former spouse from the title.

The divorce decree or a related court-approved settlement typically establishes who retains ownership of the home and authorizes the title transfer. Title companies usually require this documentation before removing a spouse from title to ensure the change is legally valid and enforceable. In some situations, an additional deed may also be required to complete the transfer, but it is generally based on the terms of the signed divorce decree.

Yes, the state you live in matters.

Divorce and mortgage rules vary by state, particularly around property ownership, equity division, and title transfers. Community property states like California generally treat marital property differently than non-community property states, which can affect how buyouts and refinances are structured. Texas is unique in that some divorces use an Owelty lien to secure a spouse’s equity interest until it is paid off through a refinance or sale.

Lenders and title companies follow the laws of the state where the property is located, not just where the divorce was finalized, which is why state-specific structuring matters when refinancing after divorce.