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Having a strong divorce team with creative thinking can help solve common concerns regarding the marital home or purchasing a new home post-divorce. Couples contemplating divorce often ask, “What am I legally entitled to?”
It is natural to seek information that aids in divorce planning and setting expectations. Since divorce is a legal process, people often turn to “legal entitlements” as a benchmark.
The Power of Creative Thinking in Divorce Settlements
Creative solutions are not only applicable to parenting plans but also to the allocation of income and the distribution of marital assets and liabilities, including the disposition of the marital home and helping one or both spouses obtain mortgage financing.
Many believe that creative thinking strikes at random. In reality, creative problem-solving can be applied every day, even if you think you lack creativity. Creative thinking involves gaining new insights and different ideas from existing information. Consider an Equity Buy-Out as an example:
A wife retaining the marital home is awarded spousal support for three years. When she meets the proof of receipt requirement to use the income as qualifying income, she may no longer meet the continuation requirement. A creative solution could be to lower the monthly support payment and extend the payment period to 42 months. As long as the lower payment amount meets the needs for mortgage qualification, the continuation of 36 months post-loan closing should be met.
Benefits of Creative Thinking in Divorce Mortgage Planning
Creative thought involves tapping into different thinking styles and examining information from various viewpoints to develop new strategies and opportunities. Fostering creative thinking starts with changing your perspective.
Why is creative thinking critical? Getting stuck in the same thought patterns can hamper innovation and keep you in routines that don’t serve the best interests of the divorcing couple. Creative thinking provides multiple solutions to any problem, helping you recognize innovative solutions more quickly. It makes you a better problem-solver, with benefits in both your work and personal life.
Role of Certified Divorce Lending Professionals (CDLP®)
Certified Divorce Lending Professionals (CDLP®) have a significant ability to think creatively when divorce, real property, and mortgage financing intersect. Their extensive knowledge allows them to work directly with professional divorce team members and divorcing homeowners to devise creative solutions. Whether the need is to refinance the existing mortgage on the marital home or to ensure both spouses are in a position to purchase new homes post-divorce.
Advantages of Divorce Mortgage Planning with a CDLP®
- Identify Possible Solutions: A CDLP® helps both parties let go of counterproductive positions and emotions while considering possibilities, resources, and solutions.
- Qualify for Equity Buy-Out: A CDLP® can help identify sources of qualified income that may enable the retaining spouse to qualify for an equity buy-out refinance now or develop a mutually acceptable plan to obtain mortgage financing in the future.
- Purchase New Home: A CDLP® can assist the vacating spouse in purchasing a new home while still on the note to the marital home by ensuring a court-ordered assignment of debt and proper verbiage in the marital settlement agreement.
Successful Divorce Negotiation
Effective communication and strategic negotiations are key to ensuring both divorcing parties emerge whole or on the road to recovery. Working as a team and incorporating divorce mortgage planning into the negotiation cycle with a Certified Divorce Lending Professional will result in better solutions and outcomes for the divorcing couple. CDLP®s provide a different perspective and better solutions for both the professional divorce team and the divorcing homeowner while protecting their ability to obtain mortgage financing in the future.
Get Started with a Certified Divorce Lending Professional
Do you have questions about how divorce may impact your ability to obtain mortgage financing? A Certified Divorce Lending Professional's (CDLP®) knowledge and experience can make the transition smoother and more successful for all parties involved.
Working with a Certified Divorce Lending Professional (CDLP®) and incorporating Divorce Mortgage Planning into the divorce settlement can help both spouses secure new mortgage financing post-divorce.
Contact a CDLP® today for a copy of the Divorcing Your Mortgage Homeowner Workbook, a guide to credit, real estate, and mortgage financing after divorce. This workbook will help you get organized, be prepared, and understand your mortgage financing position whether you need to refinance the marital home in an Equity Buy-Out situation or prepare to sell and purchase a new home post-divorce.
This is for informational purposes only and not for the purpose of providing 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. The information contained in this newsletter has been prepared by, or purchased from, an independent third party and is distributed for consumer education purposes.
Copyright 2022—All Rights Divorce Lending Association
