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What Happens to Your Debts and Mortgage in a Pennsylvania Divorce?

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One of the most crucial aspects of divorce is dividing the marital estate. The marital estate is composed of assets and debts you accrued during the marriage. Debts also need to be divided in accordance with Pennsylvania’s rules of equitable distribution. Debt includes credit card debt, personal loans, school loans, and auto loans. It also includes your mortgage. It is important to address mortgages owed by the spouses for their former marital residence and any other real estate that they own. When dealing with mortgages, couples need to address both traditional mortgages and home equity lines of credit.

Who pays the mortgage after a divorce? 

After a couple separates but before the divorce is final, it is generally expected that the spouse who occupies the former marital residence will be paying the mortgage, home equity line of credit, taxes, insurance, and utilities for the house. A portion of those expenses can be handled through child support payments or alimony. In other words, the spouse not residing in the home would have to pay a portion of those expenses. The amount the spouse who is not residing in the home will have to pay is determined by the incomes of both parties and is calculated as a part of the spousal support calculation.

When a divorce is finalized, the spouses will have to decide whether one spouse will retain the house after the divorce or whether it will be sold and proceeds split. If one spouse retains the house, then that spouse will need to either refinance the existing mortgage and home equity loans or assume the financial obligations related to paying for the house.

What happens if one spouse’s name is not on the deed?

 The name on the deed doesn’t matter in Pennsylvania. Even if one spouse’s name is not on the deed to the home, that spouse likely still has an equitable interest in the value of the house simply by being married to the spouse whose name is on the deed. In other words, the title does not follow the name on the deed. The house is considered property of the marriage and is subject to equitable distribution.

It is still important to review documents associated with the purchase and financing of the house. Those include the deed, the note, and the mortgage. Reviewing these documents can help you determine the best steps to take to equitably distribute the family home.

What about other debts? 

Other debts are subject to equitable distribution. Equitable distribution means that the property is divided in a way that is fair, but not necessarily equal. If one spouse has considerably higher earning power than the other, that spouse may get more of the marital debts and less of the marital assets.

Talk to a Philadelphia, PA Family Law Attorney Today 

The Law Offices of Lauren H. Kane represents the interests of couples and individuals who are divorcing in Philadelphia. Call our Philadelphia family lawyers today to schedule an appointment, and we can begin addressing your goals and concerns right away.

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