Home Equity Buyout Calculator
Find out how much you need to buy out your spouse's home equity — and whether you can afford the new mortgage on your own.
All calculations are private — nothing leaves your browser
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Cash Needed to Buy Out Spouse
$133,000
Total Home Equity$260,000
Spouse's Equity Share$130,000
Closing / Legal Costs$3,000
New Mortgage Needed$353,000
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Advanced Analysis
Rate Scenarios · Affordability Check · DTI Analysis
Property Details
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Refinance Scenarios — 50% Buyout of $260,000 Equity
$130,000 buyout needed
| Rate | New Loan | Monthly Pmt | PMI | LTV | Total Interest |
|---|---|---|---|---|---|
| 5.5% | $350,000 | $1,987/mo | None | 72.9% | $365,414 |
| 6.5% | $350,000 | $2,212/mo | None | 72.9% | $446,406 |
| 7% ★ | $350,000 | $2,329/mo | None | 72.9% | $488,281 |
| 7.5% | $350,000 | $2,447/mo | None | 72.9% | $531,010 |
| 8% | $350,000 | $2,568/mo | None | 72.9% | $574,543 |
5.5% rate$1,987
6.5% rate$2,212
7% rate$2,329
7.5% rate$2,447
8% rate$2,568
Professional Model
Full Qualification Analysis · What-If Scenarios · 5-Year Equity Projection
Mortgage Details
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Closing Costs Breakdown
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Full Mortgage Qualification Analysis
May Not Qualify
Buyout Amount$130,000
New Loan Amount$350,000
Total Closing Costs$5,500
Monthly Mortgage P&I$2,329
PMI (monthly)None
Total PITI + PMI$2,979/mo
LTV Ratio72.9%
Back-End DTI47.7%
Cash Needed at Closing$5,500
PMI Removal PaydownNot Required
Closing Costs Breakdown
Origination Fee$1,200
Appraisal$600
Title Services$1,500
Legal / Attorney$2,000
Recording Fees$200
Total Closing Costs$5,500
How the Home Equity Buyout Calculator Works
When one spouse wants to keep the marital home after a divorce, they typically need to "buy out" the other spouse's share of the equity. This calculator helps you figure out exactly how much cash you need, whether you can afford the new mortgage, and what refinancing will look like.
Three Key Calculations
- Buyout Amount: The cash owed to the departing spouse for their equity share, plus any closing or legal costs.
- Affordability Check: Whether your income supports the new, larger mortgage under standard 28/43 lending rules.
- Refinance Impact: How your monthly payment changes and whether you'll need private mortgage insurance (PMI).
The Formula
Total Equity = Home Value − Mortgage Balance
Spouse's Equity = Total Equity × (Ownership % ÷ 100)
Buyout Amount = Spouse's Equity + Closing / Legal Costs
New Mortgage = Existing Mortgage + Buyout Amount
Monthly Payment = New Mortgage × [r(1+r)ⁿ / ((1+r)ⁿ − 1)]
DTI = (Monthly Payment + Other Debts) ÷ Gross Monthly Income
Spouse's Equity = Total Equity × (Ownership % ÷ 100)
Buyout Amount = Spouse's Equity + Closing / Legal Costs
New Mortgage = Existing Mortgage + Buyout Amount
Monthly Payment = New Mortgage × [r(1+r)ⁿ / ((1+r)ⁿ − 1)]
DTI = (Monthly Payment + Other Debts) ÷ Gross Monthly Income
The 28% rule means your housing payment should not exceed 28% of gross monthly income. The 43% DTI rule means all debt payments combined should stay under 43% of gross income — these are standard lender thresholds.
Worked Example
Example: Sarah Buying Out Mark
Sarah and Mark own a home worth $480,000 with a $220,000 mortgage balance. They have equal (50/50) ownership. Sarah wants to keep the house.
Home Value$480,000
Mortgage Balance$220,000
Total Equity$260,000
Mark's 50% Share$130,000
Closing Costs$3,000
Buyout Amount$133,000
New Mortgage (30yr, 7%)$353,000 → $2,349/mo
Sarah's gross income is $95,000/yr ($7,917/mo). Her housing cost ratio is 29.7% — just above the 28% guideline, but her overall DTI may still qualify.
Frequently Asked Questions
Most people refinance the mortgage to pull out the buyout cash. Instead of paying your spouse in cash, you refinance into a larger loan that covers both the existing mortgage and the buyout amount. The cash from the new loan goes to your ex-spouse at closing.
In most divorces, equity is split 50/50 regardless of who paid more of the mortgage. However, if one spouse had separate property contributions (a down payment from inheritance, for example), they may claim a larger share. Your divorce attorney or mediator will help determine the correct split.
If your new mortgage is more than 80% of the home's value, lenders typically require private mortgage insurance (PMI). PMI adds roughly $50–$300/month to your payment depending on loan size and credit score. Once you pay down to 80% LTV, you can request PMI cancellation.
Technically possible but risky. Both remain legally liable, so if the staying spouse misses payments, the departing spouse's credit suffers. Most divorce agreements require the staying spouse to refinance solely in their name within 6–12 months of the divorce being finalized.
Generally, transferring property between divorcing spouses is not a taxable event under IRC §1041. However, when you eventually sell the home, you'll only get one $250,000 capital gains exclusion (not the $500,000 couple's exclusion). Consult a CPA for your specific situation.