If you're currently going through a divorce, you may have already left your marital home -- and depending on the circumstances that led to your divorce, you may intend to never enter it again. Making a fresh start by leaving this home (and its memories) behind may be the best option for you emotionally, but you may be reluctant to simply hand the house over to your soon-to-be ex-spouse without proper compensation. What are your options? Read on to learn more about how you can be released from the responsibility of owning your marital home without sacrificing the hard work and effort you put into it.
What are the options for dividing home debt or equity during divorce?
Because homes are often the biggest asset (and mortgages the biggest debt) someone will have in his or her lifetime, dividing ownership of a home during divorce can be a stressful process. There are a couple of common division methods, both of which will allow you and/or your soon-to-be ex to walk away free and clear:
- Asking your ex to "buy out" your share of home equity by giving up other marital assets in exchange and refinancing the mortgage in his or her name only; or
- Agreeing to list your home on the market and splitting any resulting equity equally (or if the home is underwater, chipping in on the amount between the sales price and mortgaged amount).
How can you ensure you're properly compensated for the money and effort you put into your home?
Even if you never want to even see your marital home again, you want to receive a fair settlement in exchange for your commitment not to seek sole ownership.
You'll first want to make sure that both you and your soon-to-be ex-spouse are working with accurate sales and valuation figures. In some particularly contentious divorces, one spouse may attempt to lowball the property's value (or even seek a bogus appraisal) to lower the amount the other spouse will feel entitled to demand in exchange for giving up equity. If you suspect this may happen to you, you'll want to request that the court appoint a neutral appraiser.
If you reside in a community property state, there should be a presumption that both you and your soon-to-be ex are entitled to an equal (or equitable) share of the home's value. This often means you'll have to do less fighting for your share and can focus on the division of non-joint assets. However, if your state doesn't subscribe to this model and you foresee a battle on your hands, you'll want to enlist an attorney, such as Myers Law Firm LLC, to help you fight for what you're fairly owed.