If you are headed for divorce, perhaps one of the greatest assets that you and your spouse have is the marital home. Naturally, one of the first things that you will think about is, "What should we do with our house?" It depends.
Each married couple has a different situation in regards to their home and financial circumstances. Should you sell the house and split the proceeds? Is there even enough equity to do that?
If one of you wants to keep the house, think, is it financially feasible?
What some divorcing couples forget is that once they're living apart, they have to pay for two households, which usually causes a financial strain on the family initially.
If you have to pay spousal support to your ex, can you still afford to continue paying the mortgage on your sprawling home? Or, would a small 2 bedroom or a condo make more sense?
If the court orders your ex to pay you spousal support and you want to keep the home, can you qualify to refinance the mortgage in your name alone? Can you afford to keep up the payments?
Sometimes in a divorce, the spouses will fight over the marital home like it's some sort of prize. Then, the spouse who gets the house soon realizes that they can't afford the payments, maintenance, and upkeep, and they want to sell, but there's zero equity in the home and they're stuck.
In many divorce situations, the best way to make a clean break is to sell the marital home and split the proceeds, but that is not always the most practical, considering the housing market.
If there are enough marital assets, or you both earn a decent living, it may make complete sense for one of you to keep the marital home and buy the other spouse out of their share.
Cutting the Financial Ties
If your spouse decides to keep the marital home, we advise against keeping your name on the mortgage, because once divorced, it's not wise to have financial ties to your ex.
Your ex could be the nicest, most ethical human being on the planet, but if they become injured or ill and unable to make the payments, you will be responsible for paying the mortgage, regardless of what it says in your divorce decree.
What if the house is upside-down or neither of you can afford the big house payments? Another option is to rent the house out, and remain co-owners on the property until the real estate market heats up.
What should happen to your house during the divorce? For the guidance you need, contact our Nassau County divorce lawyer for a free consultation.