Understanding Mediation
Mediation is a process where a neutral third party assists participants in resolving disputes by facilitating negotiations and problem-solving. The mediator manages the discussions, organizes the issues to be resolved, and helps participants reach mutual and appropriate solutions. In the context of divorce, mediation involves gathering data, defining problems, and developing options. When negotiating the marital home, specialized support from a Certified Divorce Lending Professional (CDLP®) may be necessary.
The Importance of a CDLP® in the Mediation Process
Having a CDLP® involved in mediation is crucial, especially when it comes to the marital home. A skilled CDLP® ensures that negotiated agreements, such as refinancing the current mortgage for an equity buyout or selling the marital home and purchasing new homes, can be executed effectively. While reaching an agreement on handling the marital home might be straightforward, executing the agreement often requires a deeper understanding of the details.
How a Certified Divorce Lending Professional Can Help
A mediator helps divorcing couples understand their options regarding the marital home and the implications of each option. A Certified Divorce Lending Professional provides essential support by addressing the details of these options. Consider the following scenario:
Example Scenario: Jack and Diane
- Background: Jack and Diane have been married for 17 years and have lived in their home for 11 years. Diane works as administrative support at a local school and will need spousal support to afford housing independently after the divorce.
- Jack's Preference: Jack wants to sell the home and divide the net proceeds equally, allowing both parties to purchase new homes.
- Diane's Preference: Diane wants to stay in the home to avoid the hassle of moving and purchasing a new home. She agrees to pay Jack his share of the equity through refinancing, which would also remove him from any financial obligation.
Mediated Agreement
Through mediation, Jack and Diane agree that Diane will retain the marital home and refinance within 120 days. Jack agrees to give his equity share to Diane in lieu of future spousal support. If Diane cannot complete the refinance within 120 days, they will sell the marital home.
Potential Issues Without a CDLP®
Without the support of a CDLP®, several issues may arise:
- Income Requirements: Diane may not qualify for the refinance without spousal support.
- Time Frame: The 120-day deadline for refinancing may be unrealistic.
- Future Housing: If the home is sold, Diane might still struggle to buy a new home.
The Role of a CDLP® as an Expert Advisor
Mediators are not accountants or attorneys and often refer couples to experts for specific advice. A CDLP® provides essential expertise in obtaining future mortgage financing, ensuring a smooth mediation process.
Questions About Divorce and Mortgage Financing?
A Certified Divorce Lending Professional's (CDLP®) knowledge and experience can make the transition smoother and more successful for all parties involved.
The Benefits of Working with a CDLP®
An experienced divorce mortgage planner understands how divorce affects mortgage financing, benefiting both the divorce team and the divorcing homeowners. Traditional thinking does not apply to divorce and mortgage planning. Always work with a Certified Divorce Lending Professional (CDLP®) when real estate or mortgage financing is involved in a divorce.
Contact a CDLP® Today
Working with a CDLP® ensures informed decisions regarding home equity solutions and mortgage financing during and after a divorce. Contact a Certified Divorce Lending Professional today to navigate the complexities of divorce mortgage planning effectively.
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.
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