In every divorce that involves a piece of residential real estate property, the spouses will need to decide whether one of them will keep the property, or if they will sell it as a part of the divorce. When that piece of property is the family home, the unique circumstances of the spouses and their children will dictate their options.
Here are several of the most common scenarios that divorcing spouses could face and what kind of home division solution could apply:
One spouse owned the home before marriage
If one spouse owned the home outright prior to marriage and the spouses do not have any children, then the spouse who owned the home will probably get to keep the residence. However, the other spouse will be able to receive money representing any amount that the home increased in value during the marriage. If the spouses also have children together, then the spouse who is the primary caretaker will have the ability to continue living in the residence in many cases.
That said, if the spouse who owned the home cannot afford to pay the other spouse his or her share of the value increase, then he or she may need to liquidate and sell the home to cover this cost.
The spouses bought the home while they were married
If the spouses bought the home while married, then the court will consider the residence and any equity or remaining mortgage associated with it as a part of the marital estate. The home will therefore be divided as marital property in the divorce proceedings. In the case of children, the spouse who served as primary caretaker of children may have the right to stay in the property.
The spouse who stays in the property may need to buy out the other spouse for his or her share of the home equity. If this is the case, the spouses might reorganize the way they divide the marital estate so that the other spouse receives additional property to compensate for the home value. Alternatively, the spouse who stays in the home will need to have independent assets — or the ability to secure a mortgage — to pay the other spouse his or her share. If this is not possible, the spouses will need to liquidate the property.
How will you divide the family home in your divorce?
Trying to determine how you will divide your home in your divorce isn’t always easy — especially if the spouses can’t agree on a fair way of divvying up the property. By learning about the different legal solutions available, you can decide on the best option that suits your needs.