Handling a HELOC During Divorce: A 2026 Guide

Divorce and Debt: The Undo Button

Divorce is messy. When a home with a HELOC is involved, it gets messier. In the eyes of the bank, you are both "Jointly and Severally Liable." This means if your ex spends $50,000 on the HELOC and runs away to Mexico, the bank will come after YOU for the full amount.

Immediate Step: Freeze the Line

Before you even hire a lawyer, call the bank and ask to "Freeze the HELOC for future advances." This prevents an angry spouse from maxing out the credit line out of spite (a common occurrence). Both parties usually need to sign a letter to do this, but some banks allow one party to freeze it.

Scenario 1: Selling the House

This is the cleanest break.
Sale Price: $500,000
- Pay off Mortgage: $300,000
- Pay off HELOC: $50,000
= Net Proceeds: $150,000.
You split the $150k according to your settlement.

Scenario 2: One Spouse Keeps the House

If you want to keep the house, you must "Buy Out" your ex's share of the equity AND remove their name from the debt.

• Refinance is Mandatory: You cannot just remove a name from a deed and mortgage. You typically must refinance the primary mortgage + HELOC into a new loan in your name only.
• The Challenge: You must qualify for the new loan on your single income. In 2026, with higher rates, this is difficult.