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Divorce Buyout Mortgage Finance buying out your ex-spouse's share, structured around your divorce

A Divorce Buyout Mortgage is how you finance buying out your ex-spouse's share of the home, structured around your divorce settlement. Usually it is a cash-out refinance; in Texas, an owelty of partition lien can finance the buyout without the 80% cash-out cap. As a Certified Divorce Lending Professional, Niko structures the financing to match the decree. This is financing information, not legal or tax advice.

By Niko Kramer, Mortgage Loan Officer, Satori Mortgage, NMLS #2180891 Certified Divorce Lending Professional (CDLP)

Last updated: June 18, 2026

Talk to Niko Call (512) 270-2835

This is the financing front door. For the full picture, start with the Divorce and Your Mortgage guide, and estimate your numbers with the divorce buyout calculator.

Niko Kramer, Mortgage Loan Officer, NMLS #2180891, Certified Divorce Lending Professional
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What is a Divorce Buyout Mortgage?

It is how you finance buying out your ex-spouse's share of the home's equity in a divorce, structured around the settlement. In most states that means a cash-out refinance; in Texas it can be an owelty of partition lien. It is not a separate agency loan product, it is the structuring and guidance Niko provides as a Certified Divorce Lending Professional.

More: Divorce and Your Mortgage (the full guide).

Do I need a special loan to buy out my spouse?

No. It is typically a cash-out refinance, or in Texas an owelty of partition lien; there is no separate divorce loan product with its own rate or underwriting box. The Divorce Buyout Mortgage is how Niko structures and guides that financing for a divorce, matching it to the decree, not a different mortgage.

More: How a divorce equity buyout is financed.

How is the buyout amount and new loan calculated?

The new loan is your current balance plus the buyout, which is your ex's share of the equity that the settlement sets. So the new loan is larger than your old balance. You can estimate the new loan and loan-to-value with the divorce buyout calculator; the buyout guide covers how it is sized and priced. The settlement sets the split, not the calculator.

More: Divorce buyout calculator.

How do I qualify on one income?

The staying spouse generally has to qualify for the new loan alone, on their own income, credit, and debt-to-income. A non-occupant co-borrower, often a parent, can help when your own numbers are tight. Qualifying on one income, not the equity, is usually what decides a buyout, so it is worth checking early.

More: Qualifying on one income after divorce.

What is different in Texas?

Texas has a tool most states do not: a court-ordered owelty of partition lien. A standard Texas cash-out refinance is capped at 80% of value, but a properly structured owelty can finance the buyout as rate-and-term, with the loan program setting the ceiling, instead of being held to the 80% cap. The decree has to create the owelty correctly.

More: How a Texas owelty lien finances the buyout.

Does it work differently in my state?

Yes, the tax treatment of the transfer, who has to sign, and the division standard vary by state. I have written state-by-state divorce-and-mortgage guides for where I am licensed, covering each state's specifics, so you can see how a buyout works where you are before we structure the financing.

More: Divorce and your mortgage by state.

Frequently asked questions

It is how you finance buying out an ex-spouse's share of the home's equity in a divorce, structured around the settlement. In most states it is a cash-out refinance; in Texas it can be an owelty of partition lien. It is not a separate agency loan product with its own rate or underwriting; it is the structuring and guidance that a Certified Divorce Lending Professional provides to match the financing to the decree.

Usually, yes. In most states a divorce buyout is financed as a cash-out refinance: the new loan pays off the old mortgage and funds your ex's share of the equity. When the settlement documents the buyout, it can be priced better than a standard cash-out because it avoids the cash-out loan-level price adjustments (LLPAs) that raise cash-out pricing, so it prices closer to rate-and-term. In Texas, an owelty of partition lien is used instead. Either way, there is no separate divorce loan product.

Often, with an owelty. A standard Texas cash-out refinance is capped at 80% of the home's value, but a court-ordered owelty of partition lien can finance a divorce buyout as a rate-and-term refinance, with the loan program setting the loan-to-value ceiling, instead of being held to the 80% cap. The decree has to create the owelty correctly, so the wording matters. Confirm the structure before signing.

It depends on your state and how title is held; in many states a spouse must join to convey or encumber the marital home or homestead, so a refinance before the decree often needs both signatures. The rule, and how it interacts with the decree, varies by state, so I coordinate the refinance timing with your attorney. This is a property-title requirement, not a comment on whether you qualify on your own.

Go deeper in the divorce guide

This page is the financing front door. The depth lives in my divorce-and-mortgage guide, so I link it rather than repeat it:

Buying out your ex and keeping the home? Let's structure the financing.

Tell me the value, the balance, and the split your settlement sets, and I'll size the buyout, check that it works on your own income, and coordinate the refinance or Texas owelty with your attorney, with no pressure and no credit pull.

Talk to Niko