Here’s an example: Tom and Katie are going through a divorce. They own a home together with a mortgage. Their home is valued at $500,000 and Katie and Tom currently owe $300,000. Let’s assume they are splitting the equity 50/50 (or $100,000 each). Their divorce decree must specify the owelty and the owelty lien must be recorded. Katie would then refinance the property at $400,000: the $300,000 owed on the mortgage in addition to Tom’s $100,000 owelty lien. The end result is Tom gets his $100,000 and Katie is the full owner of the home. Tom is no longer on the note nor the deed.