Divorce creates the need to settle the community property of spouses (bezpodielové spoluvlastníctvo manželov, 'BSM'), particularly where there is a jointly owned flat with a mortgage. Settlement is subject to a three-year time limit running from the date the divorce judgment becomes final; once it expires, the flat automatically passes into fractional co-ownership (50/50) and the debt remains joint. Releasing one of the ex-spouses from the mortgage requires, first of all, the bank's approval based on a creditworthiness assessment, and only then the signing of a BSM settlement agreement.
The carousel of emotions and changes does not end with the divorce. On the contrary, one of the most important chapters opens: the community property of spouses (bezpodielové spoluvlastníctvo manželov, 'BSM') and its fair settlement. If you acquired a flat during the marriage financed by a mortgage, after the divorce you face a fundamental question: How do you properly settle this joint obligation and asset?
From the moment the divorce judgment becomes final, a three-year period for the settlement of the BSM begins to run. If you do not manage to reach an agreement or file a court action within these three years, a so-called statutory settlement occurs, by way of an irrebuttable presumption.
What does that mean in practice? Movable items remain with the spouse who actually uses them. With immovable property, however, such as a jointly owned flat, a fundamental transformation takes place: the BSM ceases to exist and the flat automatically passes into fractional co-ownership, with both ex-spouses holding equal shares (50/50). This outcome is almost always undesirable. You become co-owners with more complicated rights, while your mortgage debt at the bank remains joint and several.
Many people wrongly assume that signing a BSM settlement agreement is enough and the matter is closed. For the bank, however, such an internal agreement between ex-spouses is irrelevant. For one of you to be definitively released from the obligation, you must proceed on two levels:
One of the most frequent sources of conflict arises where money from different sources was invested during the marriage. Each spouse is obliged to reimburse what was spent from the joint property on their sole property (for example, where joint family money was used to renovate a flat that one of you inherited). It also works the other way round — if you used money from a gift from your parents or from the sale of your premarital property (sole ownership) for the down payment on a jointly owned flat in the BSM, you are entitled to claim those funds back in the settlement.
As a lawyer, I make a point of handling these situations not by feel but through transparent asset calculations. Every single euro, every mortgage instalment before and after the divorce, and every documented investment in renovation must be supported by exact figures and documents. Only clear financial mathematics can deliver a fair outcome without quarrels.
A court dispute over property is expensive and psychologically exhausting. You will pay a considerable court fee (usually up to 3% of the value of the property being settled), invest thousands of euros in expert opinions and years of legal representation. Worst of all, the dispute may drag on for years, during which you cannot freely deal with the property and cannot move on with your life.
A well-prepared out-of-court agreement is done within a few weeks, costs a fraction of the price of court proceedings and, above all — the two of you control the outcome, not a judge. The money, time and nerves you save can be invested in your new, peaceful beginning.
As a lawyer, I will prepare a fair out-of-court agreement for you and precisely calculate your mutual investments, so that you achieve a fair outcome you will be satisfied with.
