What happens to the family home when you divorce? It is one of those questions that could cause a massive fallout while trying to answer it.
If only one of you wishes to keep the property, you need to find a way to compensate the other person. Taking on your spouse’s portion of the mortgage is one option, but only if you have the financial capacity to pay it. Alternatively, you could keep the house in exchange for them taking a greater portion of other marital assets. Yet, that also requires you to have the funds to do so.
Selling is often the best option
Selling the property is the most viable option for many couples. You can treat the profits as one more bit of cash to divide along with your other assets. Getting rid of the house has other advantages too:
- Houses you shared are a reminder of the past: However much you change the paint scheme and rearrange the furniture, a house you lived in together will hold memories. Sitting at the breakfast bar might remind you of happier times when you sat watching your spouse grind coffee on the weekends. It may leave you wondering if you did the right thing in divorcing. Or, you might get a flashback of the time your spouse threw a glass full of freshly squeezed orange juice at your head because you had not removed all the pips. Either way, it may be better to free yourself of such memories.
- House values can change, leading to disputes: Let’s say when you decided to keep the house, it was worth $500,000, and you agreed to compensate your spouse appropriately. If it shoots up in value before the divorce is final due to an unstable or hot real estate market, they might claim they got an unfair deal and make your life difficult by demanding more money.
Getting help to understand the advantages and disadvantages of different options will be crucial to getting a property division outcome that stands you in good stead for the future.