Through divorce and property settlements, women sometimes end up as the sole owners of homes that they previously owned jointly with their spouses. Women are frequently happy when this happens, but getting the family home in a settlement isn't always a big win.

Take for example, the case of a woman who, after careful planning and some spirited negotiation, got the family's luxury home in a hotly-contested divorce settlement. Located in an upscale neighborhood, the home was valued at more than a million dollars. And because it had originally been purchased with her ex-husband some fifteen years earlier, the property had more than quadrupled in value over the years. What's not to be happy about?

Yes, a mortgage was needed to secure the home, but the monthly payment was well within her ability (or so she thought). She felt compelled to keep the property to avoid changing schools, and to minimize the impact of the divorce on her two sons. "Besides, on my salary, there's no way I'd ever be able to afford another home as nice as this one," she told me.

Less than two years after the divorce, things started going downhill. First, the water heater needed to be replaced — a $700 expense, charged to her VISA card. Then, there was a leaky roof — $1,600, also charged to the card. In the summer, the pool's filter pump died right after she returned from vacation (the repair and the vacation went on the card too). She wondered what might come next.

Then, toward the end of summer, her car's transmission failed. Because the warranty had expired a year earlier, she was facing a nearly $2,000 repair bill.

The woman's brother came to her rescue and helped negotiate the purchase of a new car. Given the condition of her trade-in and her desire for a "larger and safer car," she ended up with a monthly payment of roughly $200 more than she'd been paying. The car also required more gas, nearly twice that of the previous car.

Her debt was piling up. After another year more small repairs and routine maintenance (like lawn care and snow removal costs), she noticed her daily cost of living mounting. Before she knew it, her credit card debt had grown from zero to more than $19,000, all since the divorce.

She wanted to find a way to keep her home, so she researched home equity loans that might allow her to consolidate her card debt and also pay for the roof. We discussed the subject, and I explained the difference between a home equity line of credit (HELOC), and a fixed home equity loan.

What did she do? Tune in tomorrow for part two.

Brian Kilroy is a FWW supporter and retired Vice President of MBNA America Bank, N.A. He directed the Financial Advisory Service, an employee assistance, credit education and lending unit servicing MBNA employees worldwide.

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