A property decoupling loan is used by homeowners who are going through a divorce and want to
separate their mortgage from their property. When a couple divorces and one spouse wants to keep
the family home, they may be unable to do so if they are unable to pay off the existing mortgage on
their own.
In this case, a property decoupling loan can be used to pay off the existing mortgage, allowing the
spouse who wants to keep the home to take ownership of the property free and clear. The spouse
who is no longer interested in the property can then use the proceeds from the sale of the home to
pay off their share of the mortgage.
However, it is important for homeowners to carefully consider the terms and conditions of these
loans, as well as the potential risks and benefits of separating their mortgage from their property,
before taking one out. Some of the factors that homeowners should consider include the interest
rate, fees, and repayment terms of the loan, as well as the potential impact on their credit score and
financial situation.
In some regions a decoupling loan is for homeowners who want to sell their property but have not
yet paid off their mortgage and is thus unable to do so. So, they will take out a property decoupling
loan, which is used to pay off their existing mortgage. The homeowner then becomes the owner of
the property free and clear, which means that they own the property outright and are not
encumbered by a mortgage, or at least with the previous lender.