The largest asset — and debt — most Illinois residents own is their house and the mortgage loan that often goes with it. During the marriage, both spouses may work to pay that mortgage and make the house a home. If the marriage ends, dealing with the house could be one of the primary concerns during the divorce process.
In nearly all divorce cases, couples have three choices regarding what to do with the family home. First, if one party wants to keep the home, he or she could refinance the mortgage loan alone, which would free the spouse not keeping the home from any liability for the mortgage loan. However, this is not always an option since it may not be possible to refinance with only one income. Therefore, it may be necessary to move on to options two and three.
Second, it can be sold. The parties can split any proceeds, and the mortgage debt is no longer a concern for either party. Third, the parties may agree to keep the home in the short term until either it is possible to sell the home or one party can obtain financing to keep it. The parties need to look at the situation collectively and separately in order to determine which option works best for each of them.
Finding a solution often requires considering numerous factors. Illinois couples in the grips of a divorce may not consider all of the relevant factors such as tax implications, maintenance requirements and other financial obligations that come with home ownership without help. An attorney could outline all of the considerations, thoroughly explore all of the options and provide advice regarding the best course of action. The parties can then make the final decision.
Source: nerdwallet.com, “How to Split Home Value in a Divorce“, Holden Lewis, Nov. 22, 2017