The family home is often at the center of a divorce. It is likely one of the most expensive and valuable assets that you own. People often also feel a connection to their home that goes beyond simply the financial value of the house. This is especially true if you have children and they want to try to stay in the home.
You may be unsure exactly what to do with the house as you divide your assets and focus on your future. To help you get started, here are three different options that people often use.
Selling the house
First and foremost, if you’re willing to sell the house, this can be the easiest solution. You just put the house on the market, sell to a third party and then divide the money between you and your spouse. Maybe you made $100,000 on the sale, for instance, so that means you both get $50,000 during the divorce. You can take this and use it as a down payment on your own home.
Buying the other half
If one of you wants to own the house and the other doesn’t, it is potentially possible that you could buy the half of the home that your spouse owns. You may have to refinance the mortgage anyway, so then you can buy out your own previous mortgage. Your spouse needs to be given financial assets equal to the value that they would have received if the home was sold to a third party, as noted above.
Continuing to own the home
The least common option, although technically possible, is to continue to own the home together. If the two of you are on the mortgage, you don’t have to worry about asset division because the house is already divided. However, this means that you would both be responsible for the payments. You also would have to work together to manage the property, cover the taxes, pay for utilities and things of this nature.
That said, some parents decide to do this because the children don’t want to move. They own the home jointly for as long as the children are still living there, and then they sell it in the future and split the proceeds at that point. In some cases, if the market has gone up by that time, they even may end up making more money than they would have.
These are just three options that you can consider. No matter what you’d like to do to divide assets during your divorce, just be sure you understand exactly what steps you need to take.