In our last post, we talked a little about dealing with your home when considering divorce. In addition to the idea of one spouse refinancing on their own or buying out their former spouse, below are a few other options and ideas to consider.

Attempt to sell the home if you can't afford to stay.

Many times, neither spouse can afford to keep the home on his or her own. With the current economic landscape, refinancing on your own might be a near impossibility. While selling in this real estate market may be difficult, it is still possible to sell a home, especially if you don't have to ask for full market value.

However, even if you owe more on your home than it might sell for, it may still be possible to sell the home. If you are having difficulty selling the home and foreclosure is becoming a risk, you may want to talk to your lender about a short sale.

A short sale is essentially an agreement with your lender to accept less for the home than the value of the mortgage. The lender benefits in not having to deal with a foreclosure, and the borrowers benefit in having the lender agree not to hold them responsible for the difference between the selling price and the mortgage value.

The downside of a short sale for the divorcing couple is that they do not get any money out of the sale and they probably will end up with a note on their credit report saying they did not pay the mortgage as they originally agreed. Keep in mind, however, that this will not be seen as negatively as a foreclosure on your credit report.

Consider bankruptcy if nothing else works.

Having your home go into foreclosure is maybe the worst option. If you walk away from your home, your credit will be badly damaged and the bank could pursue both spouses for the money left on the mortgage. If you don't have any other options, you may want to speak to an attorney about filing for bankruptcy before finalizing the divorce process. Once you file for divorce, you may find your lender more willing to work with you to arrange a sale of your home.

Related Resources:

Need to Sell your House in Divorce? (Divorce360)