Who Gets The House In A Divorce?

The house a couple lives in is often their biggest asset. If the house was purchased during a marriage, it is considered a marital asset that ultimately needs to be divided in the event of a divorce. This is the case regardless if one or both spouse’s names are on the deed. So, what are your options when it comes to homeownership during a divorce?

How Is A House Divided In A Divorce?

There are two typical ways for you and your spouse to divide the equity in a house during a divorce, which includes the following:

• Sell the house and divide the net proceeds evenly.
• One spouse can refinance the debt secured by the house to remove the other spouse from the obligation while buying out the other spouse’s interest in the equity, at the same time.

The options above depend on whether either spouse wishes to keep the house and can actually afford to keep the house. If neither spouse wants the house, then the house will usually go on the market. If one spouse does want the house, then he or she will need to obtain a new mortgage in a large enough amount equal to his or her equitable share of the equity.

It is possible for one spouse to refinance the mortgage in an amount sufficient to pay off the existing mortgage and give different assets to the other spouse that ultimately offset their equitable share of the equity. The spouse must execute a new deed reflecting the new ownership, at this time.

Of course, both spouses can remain co-owners of the house after a divorce, but this situation is not recommended. Additionally, the way you hold interest in the home will change upon the divorce.

What To Do If You Want To Keep Your House

Use these three tips below if you plan to keep your house after going through a divorce.

Budget Well

Create a tight budget that can help you determine what monthly costs are associated with homeownership. You must figure out if your income and savings are enough to afford the home moving forward.

Have Sufficient Income And Savings

Having sufficient income and savings is key toward qualifying for a mortgage on your own. You will need to not only pay off the existing debt, but also buy out your ex-spouse’s share of the equity, or find enough assets that you can give to him or her to offset their share of the equity. You will need to be able to pay the mortgage, insurance, taxes, and all maintenance needs on your own.

Hire A Divorce Attorney

You need to seek the advice of an experienced divorce attorney if you wish to keep your home after a divorce. Contact the team at Canterbury Law Group today!

Source:

1. Who Gets The House In A Divorce? Retrieved September 11, 2024. from https://www.johnsonduffie.com/articles/who-gets-the-house-in-a-divorce/