New Maryland Divorce Law Helps Homeowners Keep Their Homes Without Refinancing

Starting October 1, 2025, Maryland is introducing a new law (House Bill 1018) that could make life a little less chaotic for homeowners going through a divorce.

Here’s the short version: if both spouses are on the mortgage, one spouse may now be able to keep the home and take over the loan—without refinancing.

No fresh loan. No starting over at today’s higher interest rates. No piles of closing costs. Just the same mortgage, now in one person’s name (if they qualify).

What This Means

If your divorce is finalized on or after October 1, 2025, and the court awards you the home, you can ask your lender to let you assume the loan in your name only.

The lender will still check that you qualify financially—credit score, income, and debt levels—but if you pass the test, you can stay put under the same mortgage terms. That’s a big deal in a world where refinancing often means doubling your interest rate.

Which Loans Are Covered

This new rule applies mainly to conventional home loans, meaning loans that aren’t backed by the federal government. Here’s the breakdown:

Covered:

• Conventional loans made on or after October 1, 2025

• Even older conventional loans will be treated as if they include this new clause

Not Covered:

• FHA, VA, or USDA loans (though many of those already allow assumptions)

• Loans from national banks like Wells Fargo, Chase, or Bank of America

• Loans from federal credit unions

If you’re not sure what kind of mortgage you have, your lender can tell you quickly.

What Lenders Have to Do

Starting this fall, lenders must give buyers a written notice before the loan application is completed, letting them know their new loan can be assumed after a divorce. It’s a small change with a big impact: more transparency and fewer surprises when life happens.

Why This Matters

Divorce is already enough of an emotional and financial storm. This law gives homeowners a way to stay rooted when everything else feels like it’s shifting.

It’s also a recognition that a home isn’t just a financial asset—it’s stability and continuity. And in a world where refinancing could mean trading a 3% loan for a 7% one, the ability to assume your existing mortgage can be a huge relief.

Resources and Complaints

If you need help or want to file a complaint about a mortgage lender or servicer, contact the Maryland Office of Financial Regulation:

• Website: www.labor.maryland.gov/finance

• Email: CSU.Complaints@maryland.gov

• Phone: 410-230-6077

• File Online: https://www.labor.maryland.gov/finance/consumers/comphow.shtml

The Cheverly Goodlife Takeaway

Maryland just gave divorcing homeowners a better option—and that’s progress. If you or someone you know might be affected by this, talk to your lender, your attorney, or your real estate advisor before making big moves. Staying in your home might now be easier than you think.

Thinking about your next move?
Let’s talk through your options—whether you’re planning a sale, a buyout, or just want to understand how your home fits into your future.
Contact Susan Pruden | TheCheverlyGoodlife.com