What if I owe more than my house is worth?

            The headline in a recent issue of the Fort Worth Star Telegram stated that "fewer area homeowners in negative equity".  The article discussed that in the Fort Worth/Arlington area, the number of homes "underwater" had been reduced from 12 percent to 11 percent.  Rather than 45,175 properties having negative equity, only 42,705 properties had negative equity in a recent survey.

            Wait.  What does this have to do with my divorce.  Well it has quite a bit to do with it actually.

            Just a few years ago it was rare for our firm to handle divorces in which a house had no equity.  Generally the fight before was over who got the house or who got the equity from the house or how was it split.  Now, instead of fighting over who gets the house or the proceeds from the house, divorcing couples are having to determine who gets to pay off a debt when there is a house that will not support it.  Even if only 11½ percent of all homes have negative equity, our experience is telling us that a far higher percentage have negative equity in a divorce.  That, of course, is understandable.

            Typically, one party has income to support the debt and the other party does not.  That only complicates the situation.

            At the Bob Leonard Law Group we try to help our clients navigate these treacherous waters.  Sometimes we can arrange for the lender to take a deed in lieu of foreclosure.  Sometimes it is simply better to let the lender foreclose on the property.  Sometimes one of the spouses believes that the market will go up and we work hard to obtain financing or a creative solution to allow that spouse to keep the house even if it is currently in a negative equity status.

            While we cannot take either spouse's name off of the mortgage (that is a contract with the mortgage company and the court has no authority over them), sometimes because of creative financing or some other effort we can help a client to get out from under that burden.  Of course, sometimes the facts are such that that is just impossible.

            If we at the Bob Leonard Law Group can help you to resolve your divorce issues, whether because of negative equity in a house or otherwise, please give us a call at 817‑336‑8500.  Our attorneys are experienced in looking for creative solutions to problems such as this. Let us help.