How to deal with the house mortgaged by parents at the time of divorce depends on the specific situation. If parents make it clear before marriage that the down payment of capital contribution is given to one of their children and only registered in the name of that party, then both parties can negotiate to solve the problem of housing division. If negotiation fails, the people's court may rule that it belongs to the registrant.

Husband and wife sign a contract for the sale of real estate before marriage, pay the down payment with personal property and borrow money from the bank, and repay the loan with the same property after marriage. If the real estate is registered in the name of the down payment payer, the real estate will be handled by both parties through agreement at the time of divorce.

If no agreement can be reached in accordance with the provisions of the preceding paragraph, the people's court may decide that the real estate belongs to the party with registered property rights, and the unpaid loan is the personal debt of the party with registered property rights.

Legal objectivity:

The Supreme People's Court's Interpretation on the Application of the Marriage and Family Section of the Civil Code of People's Republic of China (PRC) (I)

Article 78

Husband and wife sign a contract for the sale of real estate before marriage, pay the down payment with personal property and borrow money from the bank, and repay the loan with the same property after marriage. If the real estate is registered in the name of the down payment payer, the real estate will be handled by both parties through agreement at the time of divorce.

If no agreement can be reached in accordance with the provisions of the preceding paragraph, the people's court may rule that the real estate belongs to the registrant, and the outstanding loan is the personal debt of the registrant. At the time of divorce, one party to the real estate registration shall compensate the other party according to the principle stipulated in the first paragraph of Article 1087 of the Civil Code.