In many divorce situations, considering what happens to the house can quickly become one of the most contentious issues. If neither spouse wants the home or neither can afford to purchase the other’s interest, selling is usually the next option. Below, we cover the factors to consider when determining how to sell a house during a divorce.
Divorce: Selling the House
The primary focus of divorce proceedings typically involves the highest valued assets, such as real estate. The family home is often the highest valued marital asset, but it can also hold significant sentimental value.
The home’s value, however, may be encumbered by a primary mortgage, secondary loan, and/or a home equity loan or home equity line of credit. And, in rarer circumstances, even a governmental tax lien. You’ll need to discuss with your former spouse and/or attorney how to settle these liabilities before selling.
When deciding whether to sell the house, spouses realistically have three options:
1. Put The House On The Market
If you’ve decided to put the house on the market, a significant amount of planning must precede the sale. First, discuss with your attorney and your former spouse the list price and ideal sale price, as well as your lowest acceptable offer. You will need to address the costs of necessary repairs or maintenance needed before listing the property. Additionally, you probably need time to divide your personal property and decide what, if anything, will be left in the house for staging.
Then, agree on a plan for splitting the proceeds. Since Washington is a community property state, any marital property will be divided equitably. A divorce attorney can assist with the valuation process.
If you hold other significant assets such as stocks, art, or a vacation house, you may consider allowing your former spouse to retain this property in exchange for the home or vice versa.
2. Buy Your Spouse Out Of Their Interest
As a community property state, you and your former spouse potentially have an equal interest in the family home. If one spouse wants to keep the home, that person could opt to buy out the other. This means that the spouse in question must have enough liquid cash not subject to the divorce estate to afford the purchase price or be able to secure financing for the buyout without the soon-to-be ex-spouse.
Once the divorce process has ended, the former spouse must then be able to afford the mortgage, taxes, and home insurance on a single income. This may also include applying to refinance the mortgage, which a bank may not necessarily approve on a single income.
3. Sell The House After A Designated Period
A third option is to sell the house after a specified period of years. For example, if you have children younger than 18, it may be important to you that your children spend their adolescence in the family home. In this scenario, one spouse could retain the home until the kids move out, at which point the home is sold and profits are split accordingly.
However, this raises further questions about the home’s upkeep during the retention period. For example, will you both split mortgage costs? What about maintenance? These are all factors that you will need to consider.
Although a skilled negotiator could settle these issues, this type of agreement may be best suited to an amicable divorce lawyer because you will remain financially bound to your former spouse until the house is sold.
How To Sell A House During A Divorce
In a divorce, selling the house is possible through planning and compromise.
- Set clear expectations. Working with a real estate agent and appraiser will provide a realistic sense of your home’s value.
- Prepare the sale. Once the value is determined, put a plan into place – you must determine how you will split the proceeds and how the home’s sale factors into the division of your other assets. You must also establish whether one person will live in the house while it is listed, who will attend showings, and how you will pay the mortgage.
- Agree to compromise. Before the house is listed, determine with your former spouse and attorney the ideal price and the lowest price offer that you would accept. Maintain an open dialogue with your former spouse, realtor, and attorney.
- Divide the proceeds. Since Washington is a community property state, the home’s sale price will be divided equitably. However, other factors will affect the proceeds each former spouse receives.
Contact Divorce Lawyers for Men
Determining how to sell a house during a divorce is a challenging and often drawn-out procedure. With knowledgeable and experienced attorneys on your side, however, the process doesn’t have to be contentious. At Divorce Lawyers For Men, our attorneys specialize in navigating men through the divorce process. If you and your soon-to-be former spouse are determining how to sell your home, we can help you navigate this situation with expert legal representation and counsel.
Reach out to us today and we will answer any questions or schedule an initial consultation.