Your house is your biggest asset. There are some simple ways to save thousands of dollars if you need to sell or refinance your property during a divorce. Most people want to keep their house, but this can be difficult to manage.
First, it's important to understand that the bank will charge you more money in interest, and the bank will loan you less money, if they know that you are getting divorced. To the bank, someone going through litigation is a risk. You may be about to spend tens of thousands in legal fees in your divorce. Or, the bank might worry, you could end up with a support payment that's a stretch for your income, or owing your ex money as part of a settlement.
The bank doesn't want to make a large loan to someone in that situation. The bank will check court records before extending you credit, to see if there's a divorce case pending. If the bank finds out that you're getting divorced, they will tell you that you need to wait for your final order from the court before they will even consider extending a loan.
This could put you in a bind. You need to know if you can refinance the house before you can set your budget. Without a bank loan, you don't know how much support you can afford to pay, or what your living expenses will be, or if you will have new expenses connected to moving. It's all left uncertain.
In Washington State, couples get around this problem by giving the bank a CR2A/Settlement Agreement. A CR2A/Settlement Agreement is an agreement that you and your ex can use to work out the details of your financial settlement without going to court or starting litigation. Your CR2A/Settlement Agreement can outline your support payment, your share of community assets, and all the other questions that the bank wants to have answered before they will loan you money.
Once you and your ex sign the CR2A/Settlement Agreement, and keep a copy of your agreement on file with a lawyer, then your agreement can be enforced like a final order in your divorce. The agreement solves all the issues that might stop you from getting a loan. You can set the terms for your finances and, once your agreement is finalized, show these terms to the bank as if it were a final order from a court. You don't have to wait several months for the court to finish your paperwork. And if either you or your ex fail to perform what you've promised under your CR2A/Settlement Agreement, then the other party can ask the court for an order to enforce. Your agreement is final, on your terms, without expensive, time-consuming litigation.
Many people find that a CR2A/Settlement Agreement makes their divorce easier, faster, and less stress. Call today if you have any questions about using a CR2A/Settlement Agreement to help you keep your house in a divorce. Divorce Without Court 206-747-3029