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Here’s What Can Happen To Your House in a Divorce

Here's What Can Happen To Your House in a Divorce

Going through a divorce is a hard process in itself, but having to deal with the house you both shared can make things even more difficult. The home you shared is a source of memories, and a valuable investment of your (shared) time and money as well.

If both people agree in the divorce: When both parties can agree that one of them will keep the home and the other will find a new one, the first step is to have the house appraised to find a market value. (unless they can both agree on the value beforehand)  Once the value is determined, any outstanding money owed on the house, such as a mortgage, must be deducted. Sometimes, real estate commissions are deducted when determining the value as well, even if the party keeping the home won’t be selling it in the near future. Once the value is determined, the person keeping the house will have to pay the other person for his or her share of it. This amount can be paid in a single amount at one time, or in smaller amounts over time. The person staying in the house will also need to refinance, or remove the other person from “exiting encumbrances” on the home.

If neither person agrees in the divorce: If neither party can decide who gets to keep the house, or if neither party can afford to keep it, then it’s common for a court to order it to be sold. This can complicate things; a real estate agent has to be agreed on or appointed. Then, the asking price needs to be set, and with a clear understanding of proceedings in the case of a price reduction. Also needed is the determination of who will pay for which expenses when the house is on the market. Next, if one of the parties is living in the home while it’s on the market, they could attempt to keep it on the market longer by preventing open houses and showings. Specific agreements and/or court orders are needed because of these factors, so that things are clear-cut and alternate consequences are in order.

The process of a divorce can be taxing emotionally and financially, but it can be made easier if both sides attempt to keep a sense of objectivity, and eliminate any pettiness or bitterness. Remember that you’re moving forward, and you’ll find a new and more fitting home sweet home.

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