Splitting up is sometimes easier than splitting the house
Divorce can be tough, but what many couples may find even tougher, after they have decided to part ways, is figuring out how to untangle their assets and debts. Perhaps the most difficult asset to split during a divorce is the family home. Not only is the family home usually a couple’s biggest financial asset, it also carries a lot of emotional baggage for many couples. For that reason, deciding what to do with the house can be especially difficult. Take a look at the three main options for handling the family home and the benefits and drawbacks of each.
Sell the house and split the money
This option is perhaps the simplest and most common way of dealing with the house after a divorce. Of course, both parties will need to agree on what the home is worth and on how quickly they want to sell it. Each spouse should get their own appraisal done to help minimize disputes. Once the house is sold, the two parties can split the proceeds and then more easily move on with their lives.
One party keeps the house
Often, one party will buy out the other party’s share in the house. Sometimes there are logical reasons for doing so, such as wanting to keep children in the same school district. However, in many cases keeping the house at all costs is more of an emotional, than a rational, choice. A home that was formerly being maintained on two incomes can become a money pit for somebody trying to keep up with the same bills but on a single income. Furthermore, as Forbes magazine points out, there is a risk of falling into a negative equity situation, whereby the home is worth less than what is actually owed on it.
Both spouses keep the house
Obviously, this choice is not great for those who want to quickly move on from a divorce, but in some instances it may be the only option, at least temporarily. As NerdWallet points out, finances and children are the two main driving forces behind maintaining joint ownership of the home. Again, both parents may want to ensure their children can continue going to the same school. Also, neither spouse may have the money to buy out the other spouse or to move out right away.
A lot of decisions will have to be made during a divorce and these decisions could have ramifications for years to come. That is why anybody who is getting divorced should talk to a family law attorney as soon as possible. An experienced attorney can assist clients with the various legal issues that may arise during the divorce, including with negotiating the division of property.