What will happen to your home in divorce? A house is usually one of the biggest purchases a couple makes during their relationship. So, naturally a common question my clients have in divorce is “what is going to happen to the house”. There are options for the couple to work with either through negotiation or final trial – sell the home or keep the home.
Sell the Home – Divide the Proceeds
One of the options is that the couple puts the home on the market and when it is sold the proceeds from the sale of the home are divided between the two parties. This can happen either by agreement or by court order. If the parties are able to work together and reach an agreement, they can agree to the listing agent, the sale price and how the proceeds will be divided between themselves. Sometimes this happens during the divorce process and the parties are even able to work out who will stay in the home during the sale of the home and divorce (if anyone) but not always. Sometimes the parties agree during negotiations about the final terms of the divorce itself, to put the home on the market after the divorce.
Sell the Home – Proceeds to One Spouse
Another option is to consider when the home, is to sell the home and award all of the proceeds to one of the spouses. This is commonly used in unique situations for the parties’ for example, when there aren’t any other assets that are easily divided or awarded, the facts of the case are such that one party needs a liquid asset and by agreement of the parties.
One Party Stays in the Home
Although selling the home can be the best option, especially if the market is a seller’s market, it doesn’t always happen. The home doesn’t have to be sold. There is also the situation that one party stays in the marital home and is awarded the home in the final agreement or final orders by the Court. My experience has been that this is usually done when there are children involved and moving isn’t in the children’s best interests for one reason or another or there is another very particular reason to stay in the home. The considerations for this option are the equity or value that the party will be awarded with the home and the financing. Owning real property not only involves ownership in the land and the home but also the financing for the purchase of the home. If one spouse is staying in the home, it is necessary for that spouse to refinance the note or notes for the home. This is very important because without the refinance the spouse who remains on the financing but doesn’t live in the home may not be able to purchase a new home and will remain liable on the note(s) for the home.
Your questions about your home and other property are important. Make sure that you finish your divorce and divide your property the best way available. See a family lawyer about your questions about divorce including property issues and children.