Who Pays the Mortgage During a Texas Divorce?

When a couple decides to divorce in Texas, their mortgage is often one of the most pressing financial issues they have to address. A couple’s home is often their largest asset and their biggest monthly expense. Missed payments can affect both parties’ credit scores, available equity, and stability in their living arrangements.

Unfortunately, there’s no clear-cut answer as to who pays the mortgage during a Texas divorce. It may be the spouse living in the home, the spouse with the higher income, or both spouses together. Texas is a community property state, which means that property acquired during a marriage is generally considered to be owned by both spouses. Even if one spouse’s name is on the deed, the home may be community property depending on the facts of the case.

It’s important to address this matter fast-disagreements over payments can lead to missed payments, threats of foreclosure, and a lower credit score right when you can least afford it. Call Hargrave Law, PC at 817-968-7191 to schedule a consultation with a divorce lawyer now.

Who Pays the Mortgage While the Divorce is Pending?

While the divorce is in progress, the mortgage may be paid according to: An informal agreement between the spouses, temporary court orders, access to community funds, temporary support arrangements, or each spouse’s financial ability.

An informal agreement can work if both spouses are in agreement regarding the mortgage. This is often the easiest option for everyone involved, but it can also be threatened by disputes during the divorce process if one spouse decides to stop paying.

Temporary court orders offer a bit more protection, as the paying spouse (or spouses, if both are ordered to pay) is held legally responsible for mortgage payments. Texas Family Code 6.502 gives the court the power to create temporary orders to preserve property and protect both spouses. An order may address who remains in the home, who pays which bills, who has access to accounts, and whether one spouse has to provide temporary support.

If the topic of mortgage payment responsibility is unclear, either spouse can ask the court to address it in a temporary order. This may be the easiest way to reduce conflict, particularly if the divorce is contentious.

If One Spouse Stays in the House, Do They Have to Pay?

Remaining in the marital home doesn’t guarantee that you are the party who has to pay for the home, and leaving the home does not guarantee that you are no longer obligated to pay the mortgage. If the spouse who left the home is still listed on the mortgage, their credit is still on the line-if the other spouse does not pay, both of them could face legal action from the lender. In some cases, the spouse who stays in the house is ordered to pay. This is generally the case if they can afford the home and are benefiting from living there. However, there are cases where the spouse who leaves still has to contribute. This may happen when there is a significant income disparity, such as a relationship involving one working spouse and one spouse who works as a homemaker.

What Happens if the Mortgage Isn’t Paid During the Divorce

The consequences can be significant if the mortgage is not paid while the divorce is pending. The bank can demand payment from whoever is listed on the mortgage. Late payments generally lead to fees, default notices, negative credit reports, reduced home equity, and foreclosure if the divorce drags on long enough. This can impact both spouses, as damaged credit can make it harder to find new housing or refinance.

Even if one spouse is ordered to pay the mortgage, that does not override the agreement that the lender has with the people listed on the mortgage. If both spouses are listed on the mortgage, the lender will pursue both of them for payment-and both of them will suffer the effects of a lower credit score. The lender is not party to the payment agreement between the spouses.

This leads to a major question for the spouse who is not ordered to pay but is dealing with the consequences of their spouse not paying the mortgage. If they want to protect their credit and prevent foreclosure, they may have to pay the mortgage themselves and then ask the court to order the other spouse to reimburse them. The spouse violating the temporary court order can also be held in contempt.

Practical Steps to Protect Yourself If Your Divorce Involves a Mortgaged Home

It’s important to figure out immediately who is listed on the deed and who is listed on the mortgage. While you may assume you already know, checking the paperwork allows you to be more informed as you prepare for divorce.

You may also want to reach out to your divorce attorney to discuss a temporary court order. This is highly recommended if you cannot reach an informal agreement. Even if you do have an informal agreement, having it formalized in court can protect both parties.

Keep track of the housing expenses you incur during the divorce. If you make some or all of the mortgage payments, track those payments, as well as any money you spend on repairs to keep the house livable. These payments may be relevant during the division of assets, depending on what you and your spouse ultimately decide to do with the house and what you can agree upon during negotiations.

ALSO, finally, when you’re looking ahead at what happens with the house after divorce, be realistic about whether the house can be kept or if a sale is the better option for everyone involved. Wanting the house and being able to afford it after divorce are two separate things, and you want to set yourself up for a fresh start that does not leave you spending most of your money on a house. Finally, if both spouses are on the mortgage and one spouse is going to keep the house, insist on a specific deadline for the sale of the house.

Concerned About Your Marital Home During Divorce?

Call Hargrave Law, PC. What happens to the marital home is a crucial question in many Texas divorces. Who’s responsible for the mortgage (and who gets to live in the house) is often determined by a temporary court order until the divorce is finalized. Learn more about your options now by calling us at 817-968-7191 or contacting us online.