For many couples who are separating figuring out what to do with the matrimonial home is one of the biggest concerns. When deciding what to do with any real estate it is important to consult both a mortgage advisor and a lawyer. That said, here are the three options for dealing with the family home.
Selling the matrimonial home is one of the more popular options when it comes to separation or divorce. When you put your house up for sale make sure you:
- Hire a Realtor to provide you with the estimated market value of your property
- Calculate your respective net proceeds from the sale and be sure to keep in mind that the proceeds may not be divided in half. The division will depend on your divorce settlement.
- When selling be sure to maximize the resale value of your home. The equity from the sale typically needs to fund the down payment for two new purchases so every dollar counts!
One party buys the other out
This option tends to be the most stable for families at it allows children to remain in the home where they are most comfortable. However, it requires a lot of financial strength from one individual because the financial responsibility for the property rests on one party alone. Make sure to consult with your mortgage advisor to make sure this option is possible.
Also, don’t forget to include everyday expenses into your budget. Mortgage advisors don’t typically factor in the costs for your kids extra curricular activities or entertainment when they are figuring out whether you can afford the home.
Keeping joint ownership
This option tends to occur when one party remains living in the house and the other moves out. It is usually an interim plan and is not considered a long-term solution. Make sure you consult your lawyer and accountant as there are potential legal and tax implications you should consider if you choose this route. Most lawyers will agree that this is not the preferred option.