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Divorce and dealing with a shared mortgage or other loans

Many couples in Massachusetts who are considering or working through divorces share quite a bit of property — such as marital homes and cars. When getting a divorce, certain steps may need to be taken in order prevent any issues with a mortgage or other loans when all is said and done. If not handled appropriately, some may find they are still responsible for payments, even if they did not receive the property in their divorce settlements.

One woman recently shared her story about being held responsible for the loan on a motor home that her ex husband received as part of their divorce. She co-signed on the loan in order to help build her credit. After getting a divorce, her name was never taken off the loan. Her ex eventually filed for bankruptcy, and he has been cleared of having to pay for the loan, but she — as a co-signer — is now being hounded by creditors who are demanding payment.

It does not seem right that the person who walked away from the property should still have to make payments. Unfortunately, a lender does not care about who gets what in a divorce settlement. The company cares that both spouses signed the loan so both can be held accountable to pay the debt. There are ways to help prevent this type of issue from happening, though.

When getting a divorce, a Massachusetts couple can include certain stipulations in their agreements that give a set period of time in which the name of the spouse not keeping the property is removed from the mortgage or loan accounts. Of course, there is always an option to sell and close accounts as well. Regardless, an experienced divorce attorney can assist the client in securing a settlement that protects against the financial obligations of ex spouses in the future.

Source: moneytalknews.com, “Ask Stacy: Am I Responsible for My Ex’s Motor Home Loan?“, Stacy Johnson, Dec. 15, 2015

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