Divorced Couples Selling Real Estate
Divorce itself is difficult, but the stress of dividing assets and property only makes it more complicated. NerdWallet spoke with real estate specialists about selling and dividing your house in a divorcing.
You should get a professional house appraisal first to know how much your home is worth. Consult an attorney to decide whether it's better to sell your home or buy the other spouse out.
How to divide real property during divorce
The division of assets and property is often one of the more complicated aspects of divorce. When divorcing, it is usually easier for the couple to agree upon things such as bank accounts or retirement funds. However, real estate may be more complicated. For many couples, their home is their largest asset. It is also often the subject of a deep emotional attachment.
Understanding that state-specific rules govern property division is important. Some states adhere to community property rules, while others use the equitable division rule. According to the community property law, assets acquired during marriage are considered as marital property. As a result, they are divided equally by both parties. This rule does not apply to inheritance and gifts.
In equitable-division states, judges split a married couple's assets according to their opinion of what is fair. This could include giving the family residence to one spouse, at the expense of assets that the second party would have liked to keep.
How to get rid of real estate during a divorce
In many divorces, assets are divided and sold. Real estate, in particular if purchased during marriage, is one of most important and hardest assets to split. It can feel emotional to sell a family home, as it symbolizes the ending of a marriage.
A sale can also make it difficult to divide profits. To avoid this, both parties must come to an agreement. As an example, the proceeds may be used to reduce marital obligations or to assist an ex spouse with a downpayment on a house.
Avoid hiding assets. If you hide your assets during divorce, a court can reopen it to reevaluate how the property is divided. You can protect your self by compiling an exhaustive list of assets and ensuring full transparency. This means pulling your own credit report and obtaining the login credentials for accounts you share. This will help you get a full view of your finances so that you can give it to the judge during your divorce.
How to purchase property after a divorce
Divorce can often be a confusing process, especially when it involves property division. If you plan to purchase a home as part of your divorce proceedings, you should first consult with an experienced lawyer to understand the state law and your former spouse's rights.
An expert in real estate can also advise you how to best divide the proceeds generated by the sale of your home. This is a vital step to ensure you don't make costly real estate price mistakes that often result in failed home sales.
Real estate can become a thorny issue in a separation, but it also offers couples the chance to begin anew. In order to get on with life, couples don't have to wait until the divorce is finalized to decide on a division of their large assets. This includes the family home, boats and stock holdings.
How to finance real estate when divorcing
The majority of real estate purchased during marriage for investment purposes, or to live in as the primary residence, is considered marital, and thus subject to equitable distribution. This includes both commercial and residential properties.
If a house has an existing loan, it remains attached to the asset. It is then the responsibility whoever owns it. The debt that is not associated (credit cards, for instance) is usually shared equally by the former partners.
For determining the market value for a property or home, it is useful to consult with outside financial professionals. This avoids a possible dispute in divorce court.
Selling the property is usually the best way to ensure a smooth transaction. This removes any ongoing expenses such as property taxes, mortgage payments and maintenance costs.
Yitzchak Pierson, REALTOR® – eXp Realty LLC, New Braunfels TX
458 Russian Sage, New Braunfels Tx 78130
(512)-749-6532
[email protected]
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Divorce itself is difficult, but the stress of dividing assets and property only makes it more complicated. NerdWallet spoke with real estate specialists about selling and dividing your house in a divorcing. You should get a professional house appraisal first to know how much your home is worth. Consult an attorney to decide whether it's…