Working through a divorce is not a pleasant process to have to work though no matter how compliant the parties are. In most divorces, the home is typically the largest asset they share. It’s also very likely that there are a lot of emotional attachments to the property. If there are any children, they have perhaps spent most of their lives in the house. All these factors can make it very difficult to assign the property a real value.
The home is valuable as well as important and it can be the cause of one of the largest disagreements during the divorce proceedings. Most other items can be divided up relatively easily, but the house requires both parties agree. There are several different options available for addressing the issue. Some of the options are contingent on whether when they divorce if the house is in the husband’s name, the wife’s name, or in both of their names.
Each party can discuss with their respective attorneys how to divorce
with a house in San Antonio, so an agreement and conclusion can be reached.
Settle with a Buyout
States can vary when it comes to the laws written about spousal property, but in most states the divorcing couple can negotiate a divorce home equity buyout. This simply means one spouse retains the house as their primary residence, and the departing spouse buys out the equity they share in the house. This can become a very complicated process as both parties will have to come to a mutual agreement.
Sometimes, the party’s attorneys have to work out the specifics so it’s fair and then the two have to come to the point they agree.
This can also be a lengthy process as each party can hire their own assessors to help determine what the property is worth. The amount of equity in the home will depend on several factors such as how much the home was worth when the couple purchased it, how long they’ve been paying on the home and how much it is worth presently. If they purchased the home together and are both listed on the title deed, then one party can purchase the other’s equity in the house.
Continue to Share Ownership of the House
If a couple files for a divorce with a house in both names, it is possible to share ownership. When other options don’t make sense, the spouses can decide to keep the house the way it is. Working through their attorneys, they can agree to continue to co-own the property. This can be an agreement for a specified period of time, or it can be for an indefinite amount of time. It’s important that all the details of this arrangement be spelled out and be very clear to both parties involved. Basically, the two parties are making a business agreement when they continue as co-owners of the San Antonio property following the divorce.
One Party Lives in the House and Takes over the Mortgage
In some situations, one party can keep the house and refinance the mortgage so they can continue paying for the house. Many times, the woman stays in the family’s home with the children and the man leaves. This helps preserve the kid’s sense of security and disrupts their lives less than moving them to a new residence. In these cases, the spouse who remains in the home may have the option of refinancing. However, certain criteria would need to be met such as:
- The couple is caught up on their mortgage payments
- The spouse remaining in the home has enough income to qualify for a new loan
- The remaining spouse has good enough credit to qualify for refinancing the loan
- The other spouse is in agreement to letting go of the house
Sadly, in some instances, the remaining spouse will not have enough income to be able to afford the house payments or they don’t qualify to refinance the loan.
Continue to Share the Mortgage
For some couples who divorce and the home equity is not enough, they can continue to share the mortgage. In these situations, one of the parties remains in the home and the mortgage situation doesn’t change with the divorce. The downside to this arrangement is that if the other party stops making payments on the mortgage, it can ruin the credit line for both of them. This arrangement can work if the couple agrees that the children should be able to live in the family home until they are grown. Of course, for this to work, both parties will have to agree to it and be able to cooperate so that mortgage payments are made on time. This can be a huge risk for both parties partly because it forces the two divorcing parties to communicate and remain attached to continue to work through the details. It can also become more complicated down the road if the two later decide they would like to sell the property. Neither of the parties may be able to qualify for other home loans since their debt to income ratio would be based on the mortgage.
Sell the House and Split the Proceeds
In a few situations, neither party wants to keep the house or take on the financial obligation. Other times, the two parties cannot reach a mutual agreement on what to do with the house. Sometimes, the best option is to sell the house and split any profits. Learning how to sell a house during a divorce is not very difficult. Real estate investors can buy the house for cash so it’s a very quick process as they will come out to make an offer on the house. If the couple agrees to the price offered, then the investor will pay them cash and close within a very short time. The couple can use the cash to pay off any remaining balance on the mortgage and then they can split what’s left. This is a fair way to divide marital property.
