September 8th, 2025
How Maryland’s New Law Helps Divorcing Spouses Avoid Costly Refinancing
Posted in: Family Law Tagged: R. Chase Frederick
Author: R. Chase Frederick
In the midst of a life-changing event like divorce, stability is invaluable. To keep the status quo for their family, one party often wishes to stay in the marital home. This used to mean that the spouse retaining the home would need to fully refinance the mortgage to remove the other spouse’s name. When interest rates are high, however, this can be financially impossible.
On October 1, 2025, Senate Bill 689/House Bill 1018 goes into effect. In the past, most mortgages were not assumable on their own. Under this new law, any new conventional home mortgage in Maryland must include a provision allowing one borrower to assume the mortgage interest of the other in connection with a Judgement of Absolute Divorce. This law also applies retroactively to existing loans, so long as the final divorce decree is entered after October 1, 2025. The only catch—the borrower must be able to qualify for the mortgage on their own, or with another co-signer.
In addition to the significant financial benefits, the statute may also aid in simplifying property negotiations. For residents of the District of Columbia, however, lenders are still not required to allow assumptions of existing mortgages.
They say home is where the heart is. Maryland House Bill 1018 will allow more families to keep it that way, even after divorce. Work with a family law attorney at Stein Sperling in order to determine if you may benefit from the new law.
