How to resolve in case of divorce?

In a divorce situation, one of the most complex situations to resolve is real estate credit. As a general rule, it is in the names of both members of the couple and can be a source of conflict. Find out what paths the legislation proposes.

Mortgage credit and divorce: what should you know?
Divorce is a delicate moment in the life of any couple, with emotional, legal and financial implications. One of the most complicated issues to resolve is the fate of the mortgage, which is often the couple's biggest financial burden.
In the Portuguese context, legislation offers several options for dealing with real estate credit in the event of divorce, and the choice of the appropriate solution depends on the circumstances of each couple.

1 - Credit maintenance
One of the simplest, but also the rarest, options is to keep the mortgage in both spouses' names after the divorce. This solution implies that you will both remain responsible for paying the loan, regardless of who remains living in the house.
This option may be viable if both ex-spouses maintain a good relationship and want to keep the property as a joint investment, or if they plan to sell it later, after a significant part of the credit has been repaid. However, it must be considered that, even after the divorce, both parties will be legally committed to repaying the loan, and any default will affect both of them.

2 - Transfer to one of the spouses
Another common solution is to transfer the credit to one of the spouses. This process basically involves the purchase of the part of the property belonging to the other spouse and the assumption of the total mortgage loan by the part that remains with the house. But this involves a series of legal and banking steps:

Assessment of financial capacity: the spouse who wishes to keep the property will have to demonstrate to the bank that they have the financial capacity to assume the entire credit alone. This means that the bank will reevaluate the credit contract based on the new financial scenario, which may involve renegotiating the loan conditions, such as the term and interest rate.
Sharing agreement: in addition, the couple will need to establish a property sharing agreement, which includes the transfer of ownership of the house to the spouse who intends to keep it. This agreement must be approved in court or by a notary.
Taxes and associated costs: the spouse who buys the other's share may be subject to paying Municipal Tax on Onerous Property Transfers (IMT), except in situations where the house is the permanent residence of both and is included in the divorce agreement.

3 - Sale of the property and settlement of the credit
In many cases, the sale of the property and the consequent settlement of the credit is the most practical solution, especially if neither spouse has any interest or ability to maintain the house. What should you consider in this scenario?

Sell ​​the property: the couple puts the property up for sale, using the amount resulting from the sale to pay off the loan with the bank.
Distribution of profits (or losses): if the sale value of the property is greater than the amount owed, the profit will be divided between both parties, in accordance with the marital property regime (community of acquired assets, separation of assets, etc.). If the amount is less than the debt, the couple will have to agree how the remaining debt will be paid off. This solution is particularly advantageous when the property has appreciated in value or when both spouses want a complete separation of assets and financial responsibilities.

4 - Hand over the house to the bank (payment in payment)
A more drastic, but legally permitted, solution is payment in payment, that is, handing over the house to the bank as a way of paying off the debt. This option, however, depends on the bank accepting this agreement, which does not always happen.
Payment in payment is generally only accepted if the value of the property is sufficient to cover the entire credit owed. It is a solution that can be considered in situations where the couple faces serious financial difficulties and selling the property is not a viable option. or the market value of the property is insufficient to pay off the loan. However, it is important to understand that this process can have long-term tax and financial implications, including loss of assets and possible credit restrictions in the future.

More responsibilities to consider
In addition to the options described, it is crucial that the couple takes into account other factors that may influence the decision on home loans in divorce.

Be careful with alimony: if there are children involved, it may be necessary for the spouse who maintains the house to also pay alimony, which must be considered in the financial capacity to take on the credit.
Renegotiation with the bank: in any scenario, it is possible to try to renegotiate the credit conditions with the bank, such as the interest rate or the loan term, to make it more bearable in a new phase of life.

As you can see, resolving a mortgage loan after divorce requires consideration and, often, the assistance of lawyers and financial advisors. There are several possible solutions and the choice depends not only on each person's financial situation, but also on the personal relationship between the spouses and the property regime adopted during the marriage.