Do I Have to Sell My House in a Divorce, or Can I Keep It?
A common concern for many people going through a divorce is the though “Do I have to sell my house, or can I keep it?” A home is typically one of the largest marital assets co-owned by both spouses and you will need to decide what to do with it. In most divorce situations, you will typically have three options in dealing with the house.
Sell the House and Divide the Proceeds
In the state of Florida, spouses will split the assets equally during a divorce. That applies to the house, should neither spouse want to keep it. You will put the house up for sale, and after the realtor’s fees, taxes, and other expenses, you will both split the remaining profit.
If you have multiple homes of equal value, it may be easier for each spouse to claim ownership of one of them rather than deal with selling one or both of them. Regardless of what you decide to do here, you will need to have your home(s) professionally valued, so you know what they are worth and what figures you are basing these decisions on. Logistically, it will be easier to sell the house before your divorce is final rather than after.
One Spouse Buys out the Other Spouse Who Keeps the House
Another option is one of you gets to keep the house – one spouse can buy the other spouse out and keep it. Because of equitable distribution, the spouse who buys the house would pay the other spouse one half of the home’s fair market value. If you have children, it makes sense to keep them in their family home and avoid too much disruption in their lives. If you cannot afford to pay cash to buy out your spouse, you might have options to refinance the mortgage and roll the buyout into that.
Continue to Co-Own the House Until a Decision Can Be Made Later
Some couples decide to go another route, which is continuing to co-own the property until a later date. Each month both spouses will need to continue to pay half of the mortgage and expenses. The only caveat here is that both spouses will need to be responsible for paying their share, or late payments could affect both parties’ credit scores. Additionally, the spouse that does not live in the home cannot claim any capital gains tax deductions. Again, this option keeps the kids in their family home and may help reduce their stress and maintain consistency in their lives.
It might be tempting to sell your home quickly as a way of getting through the divorce but keep in mind you don’t want to lose money if the market is down. Take some time and talk over your options with your family law attorney to see what makes the most sense for you and your situation.