It was Benjamin Franklin who said, “If you fail to plan, you plan to fail.” What he meant was that basically, success doesn't happen by accident. It takes planning, knowing where you are heading and how you will get there. If you fail to do this you may stumble upon a win here or there, but the ultimate success won't be in that stumble.

While it may be easy to define what Mr. Franklin meant by this saying, what is more difficult, is the planning. And knowing what you want to plan for and towards. That's always the biggest question…what are you planning for or towards?

A successful divorce settlement is a result of putting the pieces of the puzzle together in such a manner that both divorcing parties come out of the divorce whole or at least on the road to recovery. When real property and mortgage financing are present in the divorce settlement, divorce mortgage planning should be a priority.

There are certain aspects of the real property itself that may not only have an impact on the marital balance sheet but on the type of mortgage financing available when one spouse is retaining the real property.

Aspects such as:

  • Who’s on the title and for how long?
  • What was the purpose of the most recent mortgage financing transaction and when was it?
  • What is the value of the real property and how/when was it obtained?

There may also be certain aspects of financial planning as part of the divorce settlement which may also impact future mortgage financing. These financial planning concerns may include:

  • Mitigating Capital Gains taxes by leaving both spouses on the title to the real property.
  • The lack of income due to lump-sum payouts versus monthly support.
  • The division of joint marital debt and how it is to be paid.

There are many aspects of the divorce settlement agreement that may have a negative impact on either spouse’s ability to obtain future mortgage financing whether refinancing the existing mortgage on the marital home or selling the home and both spouses planning to purchase new homes. When you fail to incorporate divorce mortgage planning into the divorce settlement process, the divorcing spouses may fail when it comes to obtaining mortgage financing in the future.

Divorce Mortgage Planning is a holistic approach to the process of evaluating mortgage options in the context of the overall financial objectives as they relate to divorcing situations. As a divorce mortgage planner, a CDLP®  can help you identify any potential conflicts between the divorce settlement, financial planning, and home equity solutions as well as any real property issues involved in your case.

The role of the CDLP®  is to help integrate the mortgage selected into the overall long and short-term financial and investment goals, to help minimize taxes, to minimize interest expense, and maximize cash flow. Our goal is to help divorcing homeowners make more informed decisions regarding their home equity solutions and mortgage financing opportunities during and after the divorce.

Incorporating divorce mortgage planning into the settlement process makes it easier to identify possible solutions and assists both parties in letting go of counterproductive positions and emotions. In addition, a CDLP®  can assist in taking stock of possibilities, resources, and answers regarding the marital home, other real property, and mortgage financing opportunities.

A successful divorce settlement results from effective communication and strategic negotiations in such a manner that both divorcing parties come out whole or at least on the road to recovery. Working together as a team and incorporating divorce mortgage planning into the settlement cycle with a Certified Divorce Lending Professional will ultimately result in a better solution and better outcome for the divorcing couple.

Involving a Certified Divorce Lending Professional (CDLP®) early in the divorce settlement process can help the divorcing homeowners set the stage for successful mortgage financing in the future. 


This is for informational purposes only and not to provide legal or tax advice. You should contact an attorney or tax professional to obtain legal and tax advice. Interest rates and fees are estimates provided for informational purposes only and are subject to market changes. This is not a commitment to lend. Rates change daily – call for current quotations. 

Copyright 2021—All Rights Divorce Lending Association


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