In my previous post on the question of “Who Gets the House” in a divorce, one of the options was to sell the house and split the proceeds versus keeping it and buying out the other party. So why might this be the better option?
From a practical perspective, it may simply come down to finances. If you both worked, you had two incomes to manage the mortgage. One income might not be enough to refinance a buyout and manage all the other expenses of maintaining the house – property taxes, utilities, insurance, maintenance and repairs. There are other considerations as well that may impact your decision, which I covered in my last post.
Often, one party’s desire to keep the home is an emotional one – stability for the children, staying in the same neighbourhood, holding onto something you’ve invested a lot of time in. And while these are all valid reasons, let’s take a look at the other side of the coin.
A Fresh Start
Divorce is an emotional time, and the matrimonial home holds a lot of memories, both good and bad. Moving to a new place can be the fresh start you need to get on with your life and start new memories. A new place also gives you the ability to properly grieve – the loss of your old life, death of dreams, time of transition. If you have children still at home, they are your priority, but they are more resilient than you think. You can use the excitement of a new place and new bedrooms to help them through the transition.
While the marital home is familiar, it can also become a burden. A house that was once managed by two people can be a lot to take care of on your own. You’re now responsible for cutting the grass, shoveling the driveway, managing repairs to a leaky roof, and much more. If the house is older, repairs and maintenance could become overwhelming for one person to manage – not only physically but emotionally and financially as well.
By selling the marital home, you split the proceeds of the sale and have the opportunity to use that equity to invest in a home that you can manage on your own.
Considerations When Deciding to Sell
Once you’ve decided that selling is the best option for both of you, there are a few things to consider:
- Have a Separation Agreement in place. I know I’ve mentioned this one before, but I cannot stress it enough. If you sell your home without one, the proceeds of sale can be held in trust by your real estate lawyer until an agreement is in place instructing them on how to disperse the funds. Not to mention, a bank will not approve a new mortgage for you without one.
- Market conditions may play a part in the timing of your sale. It’s important to get a professional market evaluation before you put the house on the market. If waiting makes more sense, you could rent out the house until market conditions become more favourable.
- Preparing the home for sale. Maximizing the value of your home is more important than ever, so fix-ups and minor renovations may be required to get the house ready for sale. Home staging is also critical as it presents the house in its best light and distracts buyers from looking for motivation, signs of distress, evidence of an unhappy home. I’ll be discussing this in an upcoming article.
Hire an Expert
The process of selling your home in a divorce comes with added complications and stresses not found in a regular real estate transaction. This is likely the largest asset that needs to be divided and tensions can run high.
I understand that this is more than just a necessary transaction and I am trained in the legal and financial aspects of family law and real estate. As a Certified Divorce Real Estate Expert (CDRE), I follow a Code of Ethics higher than industry standards and act as a neutral third party to ensure a fair process for everyone.
Divorce real estate is not just my specialty, it is my passion. Having gone through it twice myself, I want to ensure divorcing couples get the best possible outcome as they untangle the legal, financial and emotional ties to their house.
Have questions? Reach out…I’m here to answer them.