Should You Keep or Sell the House in a Divorce?

Divorce is tough on many levels but one of the tricky parts of a divorce is figuring out what to do with jointly owned property. Should you keep or sell the house in a divorce? If you’re making this decision, there are a few things to consider.

should you keep or sell the house in a divorce

In the midst of all the decisions that come about during a separation and divorce, whether or not to sell the house can be one of the hardest decisions to make. Getting accurate guidance from someone who has additional training in divorce real estate can make the process go more smoothly and possibly help you avoid some pitfalls along the way.

Financial Implications

When deciding whether or not one spouse is going to keep the house in a divorce, the financial implications need to be considered.

The implications are two-fold:

First, you will likely need to buy out your ex-spouse’s share of the property by refinancing. This means you will need to qualify for the mortgage payment with only your income and credit, and you will need to have enough equity in the home for the payout {unless you have other money that’s available}. It’s important to know that even if you want to buy your ex-spouse out of the house, you may not be able to if you can’t qualify for the mortgage.

Second, you will need to consider whether you can afford the mortgage payments, property taxes, home insurance, and maintenance costs on your own. Make sure you have a clear understanding of what those monthly costs are, including utilities, before you make a decision.
When this decision is first being considered, I recommend that clients talk to a lender {I’m happy to share names of my trusted lender partners} to see if it’s an option to keep the house. Often, once the financial implications are laid out, it’s just too much of a commitment.

On the flip side, selling the house could provide you with a lump sum of money that you can use to start a new life. The goal is to sell the house for the top market value you can obtain so that any equity in the house can be used by both parties to establish new households. 

Emotional Attachment

Another factor to consider when deciding whether to keep the house or sell it in a divorce is the emotional attachment you may have to the property. If the house holds significant sentimental value to you, you may want to keep it, even if it may not be the best financial decision {assuming you can afford it}. Pulling in trusted friends and family at this stage can be really helpful. Sometimes you need an outside neutral view to help you see the best path forward.

The emotional attachment can go both ways. If the house is a constant reminder of the divorce or other sad circumstances, selling the house may bring about a much-needed fresh start. I’ve known people who have been desperate to hang onto the house but then once they moved out and were settled into a new home, they had a huge sense of relief. It can be difficult to move forward when you’re constantly reminded of hard times.

Ultimately, the decision to keep or sell the house will depend on your individual circumstances, your financial situation, and your emotional ties to the property. If you’re unsure what the best decision is for you, talk to your divorce attorney, your financial advisor or a lender, and a divorce real estate specialist {me!} to help you make the best decision for your unique situation.

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