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Upside-down mortgages and property division

During the emotional turmoil of divorce in Georgia, you or your spouse may also be dealing with the physical upheaval of determining where to live. The family home often represents stability, which may make it seem worth fighting for in the divorce settlement. However, if the mortgage you owe amounts to more than the house is worth, you must determine the best way to deal with the liability. At the Siemon Law Firm, we are aware of the potential solutions to this problem, and have helped many couples reach an agreement that satisfied both parties.

According to, there is more than one way to address the negative equity in your home when dividing marital property. For example, you and your spouse may decide to accept the loss by opting for a short sale. The difference between the sale and the mortgage amount may still have to be paid if you choose this route, though. It could have a serious impact on your credit score, and you could face tax penalties, as well. However, in some cases homeowners are able to work with the lender to minimize the impact, making it much more preferable than a foreclosure.

If one of you wants to keep the home in spite of its underwater status, you may be able to treat the negative equity as one of the marital liabilities that must be divided in the divorce. So, you may agree to take on that debt while your spouse accepts the responsibility for an equal debt. Alternately, you may take the loss as a credit. The changing housing market may eventually reverse the status of your home, though, making this option decidedly unequal and therefore, undesirable. For more information about the division of marital assets, please visit our web page. 

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The Siemon Law Firm
347 Dahlonega Street, Building 100
Cumming, GA 30040
Phone: 770-888-5120
Fax: 770-521-4317
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The Siemon Law Firm
4555 Mansell Road, Suite 300
Alpharetta, GA 30022
Phone: 770-521-4316
Fax: 770-521-4317
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The Siemon Law Firm
3400 Peachtree Rd NE, Suite 555
Atlanta, GA 30326
Phone: 770-888-5078
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