Having brokers part of the planning stages of a divorce can help both parties avoid housing headache
Divorces, whether amicable or not, can be a very complicated financial transaction. This is especially true if both parties are listed on a mortgage. And while a judge can decide who gets a house in a separation, it’s up to brokers to make sure the finances line up for both sides.
While statistics vary, some government sources state that more than 35% of first marriages end in divorce. And with financial challenges consistently listed as one of the top causes of divorce, making sure any potential housing issues are resolved can be one of the top priorities.
Renee Coleman (pictured top), mortgage loan officer at CrossCountry Mortgage, is a certified divorce lending professional (CDLP). She said that divorcing spouses often know that they want to do something with an existing house, like a mortgage refinance, but might not know how to make that happen.
“There's usually one spouse, if there's still kids around, one spouse usually wants to keep the house,” Coleman told Mortgage Professional America. “They plan to keep it until the kids graduate from high school or college. But they need to know if they can afford it. Most people just think, ‘I'll just call a lender.’ But there are people out there who specialize in divorce, specifically for mortgages.”
Coleman, who also specializes in reverse mortgages, often recommends those products to those going through what is called “grey divorce,” or the separation of couples 50 years or older.
Putting together a team
However, for younger clients going through a divorce, early planning is critical. Coleman said it is essential to build a collection of experts to help you through the process.
“You want to have a divorce team,” she said. “You want to have either a divorce attorney or a divorce mediator. You'll want a financial advisor, and specifically one who deals in divorce. There's a certification, a CDFA, which is a certified divorce financial advisor. And you’ll want a lender.
“And you want to have all these people on your team, because we can put all the numbers together for you. So even though I might tell you that you qualify for the mortgage, the financial advisor might say that may not be the best thing for you.”
Not only is there a potential issue of whether someone should stay in their home, but there are also potential ramifications of buying one of the spouses out of their share of the home. Coleman also reminds clients about other large expenses that might be on the horizon.
“We've got to think about retirement,” Coleman said. “We've got to think about putting the kids through college. Maybe it's not the right thing for you to stay in the house. I tell my borrowers, because there's so much equity out there, usually, there's a buyout to the departing spouse. If one spouse is not staying in the home, the spouse keeping the home has to refinance and has to buy out the spouse.”
Coleman said one of the biggest mistakes she sees with divorcing clients is that they demand to get the house in the settlement, then visit a mortgage broker after the fact, only to find out they can’t qualify for the loan needed to refinance the home.
“You can pay your attorney all this money and say, ‘I want the house,’” she said. “Great. Your attorney will fight for you to keep the house, but you want to make sure you qualify for the house. Far too many times, I've had borrowers come to me after the final divorce agreement and say, ‘Okay, I was awarded the house, and now I have to refinance, and I have 90 days to do it.’ I put the numbers together, and they don't qualify. So had they talked to me earlier, they would have known.”
“You’re going to pay a lot less in the end”
If a separation is amicable, it is not unusual for Coleman to represent both sides in divorce mortgage planning.
“I've worked with spouses jointly, if it's amicable enough,” Coleman said. “I've worked with plenty of clients where I'm working with both of them. One's keeping the house. We put all the numbers together, and the spouse leaving might say, ‘The kids are going to be staying there. I'm not trying to drag them through the mud and take every last penny.’
“I've also worked with both, even if they're not amicable. I'm a financial neutral, right? The numbers are black and white. And we can play around with those scenarios. And then you can go back to your attorney with them and say, ‘Okay, this is what it looks like.’”
Coleman said that some clients are concerned with the costs of putting together an extensive team, on top of going through the divorce process. She tells them it will pay off when the process is complete.
Renee Coleman of CrossCountry Mortgage says reverse mortgages remain misunderstood despite improved regulations. As a CRMP, she urges better education to help seniors use home equity strategically. https://t.co/ZiBfNyMvKA#ReverseMortgage #HomeEquity #MortgageEducation
— Mortgage Professional America Magazine (@MPAMagazineUS) May 28, 2025
“They’re already paying attorneys an arm and a leg,” she said. “It's super expensive. They say, ‘We can't afford to pay a financial advisor and a mortgage advisor.’ We tell them, ‘You’re going to pay a lot less in the end.’ Your attorney is not a financial advisor. Your attorney is not a mortgage lender. They're attorneys, and that's all they know. They’re going to spend all of their time with these negotiations that may not be viable.
“If you do the upfront work, get all the numbers, and go to your attorney, and say,
This is what we're going to do,’ you're paying your attorney far less to negotiate when you know exactly what is doable.”
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