Who pays the mortgage after divorce if one spouse cannot keep up the repayments?

Who is liable for the mortgage after divorce

What matters is the loan agreement, not the divorce judgment. If you both signed it as borrowers, the debt is usually joint and several (§ 1872 et seq. of the Civil Code, Act No. 89/2012 Coll.). The bank may then demand performance from one of you, from the other, or from both, in the full amount. It does not have to take into account any different split you have agreed between yourselves.

If only one of you is on the agreement, that person is the borrower. The other may be a pledgor, because the property is encumbered by a lien (zástavní právo). In an extreme case the bank could then satisfy its claim from the property even though the other spouse is not a borrower. Check the exact position in your loan agreement and pledge agreement.

Your relationship with the bank and the settlement between spouses are two different things

An agreement or court decision saying that, for example, your former husband or wife will repay the mortgage takes effect between the two of you. It binds the bank only if the bank has expressly consented. Without that consent, nothing changes as far as the bank is concerned.

Whoever has paid more than their share can claim compensation from the other (§ 1872 et seq. of the Civil Code, Act No. 89/2012 Coll., on joint and several debts). The division of property and debts from the marriage follows the rules on the community of property of spouses (společné jmění manželů). But this route does not replace the bank: you get the money back afterwards, often only after a long time.

• Towards the bank: both of you are liable until the loan is repaid or the bank agrees to a change of borrower.
• Between yourselves: settled by agreement or, failing that, by the court.

Timeline: what to do when payments stop

As soon as you know a payment will not be covered

Call or write to the bank before the payment is missed. Banks usually have a procedure for temporary difficulties, such as a deferral or an adjusted repayment schedule. There are no guarantees, but talking to the bank before you default is always better than doing so afterwards.

After the first missed payment

1. Tell the other co-borrower. The bank will usually send them a reminder too, and they need to know about the problem.
2. Ask the bank for the current outstanding balance, the amount of penalty interest and the conditions for early repayment.
3. Find out whether the loan agreement has already been terminated or accelerated, i.e. whether the bank is demanding the entire balance at once.
4. Order an extract (list vlastnictví) from the Czech Land Registry (katastr nemovitostí) and check the liens and any notes recorded against the property.

If the default continues

The bank may accelerate the loan and hand the matter over for recovery. After a court decision or an arbitration award, enforcement by a distrainor (exekuce, Enforcement Code No. 120/2001 Coll.) and an auction may follow. In an auction the minimum bid is two thirds of the estimated price (§ 336e of the Civil Procedure Code, Act No. 99/1963 Coll., applied accordingly to enforcement), which may be less favourable for you than a sale on the open market.

Selling a house with a mortgage: how it works

Selling a property that is subject to a mortgage is common. The purchase price is used first to pay off the bank and the remainder goes to the sellers. The lien is deleted once the loan is repaid.

Where the property is in co-ownership or in the spouses' community of property, the consent of both is usually needed to sell the whole house. If you cannot agree, the only option is to go to court, which takes longer.

With a direct purchase, the process looks like this (details in the section How it works):

1. You receive a written, non-binding offer within 24 hours.
2. Contracts and a deposit are usually signed within one to three days.
3. The purchase price is paid into a lawyer's escrow account. The bank and any other creditors are paid out of it.
4. Registration in the Czech Land Registry takes roughly three to four weeks. Ownership passes only upon registration (Land Registry Act No. 256/2013 Coll.); the office may not decide earlier than twenty days after notifying the owner.
5. You receive the balance of the purchase price from escrow within five days of registration.

Payment is made by bank transfer. Cash payments are limited to CZK 270,000 per day (Act No. 254/2004 Coll.), which is why escrow is the usual and safe route for larger amounts.

What to check before selling

• Outstanding debt. The price must cover the balance, any bank fees and other entries in the Land Registry. For a rough estimate, use the calculator.
• Both signatures. Without the consent of the other co-owner or spouse, the sale cannot go ahead.
• Dividing the proceeds. Agree in advance how any remaining money will be split, and put it in the settlement agreement or the purchase contract.
• Taxes. Income from the sale may be subject to income tax (Act No. 586/1992 Coll.). This depends, for example, on the time test and on whether you live in the property. Check with the Financial Administration or a tax adviser. The real estate acquisition tax was abolished (Act No. 386/2020 Coll.).

When to consider a direct purchase and where to find more information

A direct purchase makes sense when you have limited time, the bank is already sending reminders and an ordinary sale would not be completed in time. The buyer pays off the mortgage from escrow, with no fees, repairs or clearing out the property. The price may be lower than from a long sale on the open market, so compare offers and do not rush where you do not have to.

Related situations are covered on the pages selling during a divorce and direct purchase of a property with a mortgage. You can see how it works in practice in the case study of a house with a mortgage after divorce.

If insolvency is a risk, special rules apply under the Insolvency Act No. 182/2006 Coll., and I recommend consulting a lawyer first.