Answering the Top 6 Divorce & Real Estate Questions

by questful | Oct 9, 2021 | Financial, Uncategorized

Over the course of the last few years, the divorce rate in the United States has been declining exponentially. Data fetched from Statista indicates that the divorce rate in the United States stood at about 2.7 per 1,000 of the overall population. Despite this declining number, the US divorce rate is one of the highest worldwide. And if you are going through the same, you may not be in the right emotional state right now.

And let me take some time out and tell you that it’s okay. I know you are strong – we all are. And if you feel frustrated, you can always reach out to us and have a heart-to-heart conversation with one of our experts. That’s because we care.

And if you both own a home or real estate property together yet are getting divorced, chances are that you may be looking forward to co-own it or buy it out. Or maybe you are planning to sell it to the highest bidder.

You may have a world full of questions. And trust me on this one – you’re not alone. Just like you, divorcees find themselves all juggled up and confused – finding it extremely hard to understand what to do with their real estate property. That’s what we’re here to help you with.

In this blog post, I’ve listed down the 6 most common questions couples going through a divorce ask regarding their real estate property.

So – without waiting anymore – let’s dive straight into these.

What are the Marital & Non-Marital Assets?

In a marriage, the assets are classified into:

• Marital Assets: These involve income, debts, assets that both you and your partner accumulated when you were married. Some other examples include investment accounts, pension, retirement funds, car loans, credit card bills, mortgages, and more. These will be divided between both spouses.
• Non-Marital Assets: These involve the assets acquired by either of the spouses both before the marriage and after the separation. These include your pre-marital debts, property as well as other assets – anything you can think of. Also, inherited properties and gifts are also a part of non-marital assets – so you don’t have to worry about your spouse asking you for their share of the house you inherited once.

Should I Keep or Sell My House?

I know – it might seem like a big decision – and it obviously is.

You may have spent years in your house. All those happy moments with your children and now out of nowhere you’re expected to sell it out. As much as you’d want to keep it, chances are that you don’t have the funds to buy out your spouse’s share of the equity.  Or maybe you are not financially fit to pay your home mortgage all by yourself.

In a divorce, emotions are high and if it’s a high-conflict one – both spouses may often find themselves in disagreement.

We’d advise you to sell your house if:

• You can’t afford the monthly mortgage payments all by yourself (in case there is an existing mortgage)
• You can’t afford to buy your spouse’s share of the equity.
• You find it too hard to live in the house after the divorce

And in either of the following cases, we’d advise you to keep your house (if it’s a good option):

• You have kid(s).
• You have strong memories and emotional ties associated with your home.

While there’s no concrete answer for it – the decision to sell your home or not depends on your financial situation, relation with your spouse, emotional state, and much more.

If you are planning to keep your house, ask yourself:

• Does it make sense (emotionally and financially) to keep the house?
• How long are you planning to live in the house after you keep it?
• Can you pay the mortgage all by yourself?
• How much are you willing to go through to keep it?

Should I Consider Buying Out My Spouse’s Share of Equity?

Yes – you can always buy out your spouse’s share of the equity. But it doesn’t always make sense. Following are some of the reasons you may want to keep the house:

• You have children
• You have emotional ties as well as memories associated with your home
• You are financially stable.
• The market conditions aren’t ideal right now.
• You badly want to keep your house.

Whether you want to keep the house or not, it doesn’t matter as you need to make sure that if you can financially afford to buy it out. Both the spouses may have a mortgage amount together. And chances are that neither of you may qualify to take over the mortgage all by yourself.

But if you do, you may have to refinance the mortgage in your name. And getting that done isn’t cheap. So, if you are planning to keep your house, you need to make sure that you have the money to buy out your spouse’s share of equity, refinance the mortgage and deal with all the additional costs.

What’ll Happen to My Mortgage After Divorce?

Usually in a divorce, one of the following scenarios plays out:

• Both of you agree to sell the house and pay off the mortgage – and after paying it off, both the parties collect their share of net proceeds.
• One spouse decides to keep the house by simply buying out the other spouse’s share of equity and refinancing the mortgage under their name.

However, as we mentioned above, if you are planning to buy out your spouse’s share of equity, you need to be financially stable to take over and at the same time have a good credit score to qualify for a new loan.

If the divorcing couple is underwater on their house, then the process may get even more complicated.

So, it’s advisable to talk with a real estate expert and a divorce lawyer to sort it out.

Should I Involve My Kids in This Mess?

Divorces can be hard. And they are the worst for the children. While both the spouses should keep their fights or disagreements to themselves, it’s often advisable to keep your kids in the loop.

After all, if you are planning to sell the house, they may have to move to a completely new place. You need to make them feel comfortable. Watching their parents separate is a big step for them. But you need to keep them in the loop and let them know what both of you are planning ahead.

Some questions they may have include:

• Will both (mom and dad) be living in the same neighborhood?
• Where will our dog live?
• Will we be moving to a new city?
• Will we be attending the same school?
• I don’t want to live with my brother/sister – what’s the plan?

I know that divorce is emotionally traumatizing. But it’s even scarier for children. And if you don’t keep them in the loop or inform them about your decisions, they will always find themselves scared. And they may also start feeling some negative emotions like anxiety, stress, depression – which you’d not want them to feel.

Will My Divorce Settle? Or Will We Be Going to Trial?

Over 90% of the overall divorces settle before trial. Usually, this involves one of the spouses agreeing to the other spouse’s settlement offer or via mediation.

However, there are a few cases where both the spouses can’t agree with each other’s decisions. If both of you can’t agree on how to divide your assets – you can go to trial where the court will help you out with the negotiations and split all of your marital assets the right way.

Depending on where you reside, asset distribution may vary.

If you live in a community property state, all the marital assets will be divided 50-50. This doesn’t involve non-marital assets, gifts, or inherited assets.

On the other hand, if you reside in equitable distribution state, then the assets will be divided fairly; however, they are not usually split 50-50 among both the spouses.

Some of the factors taken into consideration by the courts while determining the percentage are:

• Income of both the spouses
• Earning potential of each spouse
• Value of the spouse raising the kids or staying home.

If you are choosing to settle before going to trial, it’s critical to have a well-experienced divorce attorney by your side with experience in real estate and appraisal cases. And even if both of you can’t seem to agree on who gets to keep the house, an experienced attorney will chart a course and guide you thoroughly to help you gain insights into the process and your state’s laws.

Hit Us Up for Further Questions!

And these are just a few of the questions thrown our way on a regular basis. But these are pretty generic ones. Different couples often find themselves under different conditions. And as a result, you may have completely different questions.

Don’t let those questions eat you up. Feel free to reach out to one of our experts and we’d love nothing more than to help you.

Damon Chavez, Realtor
10135 West San Juan Way, #100
Littleton, CO 80127
Phone: (303) 649-6767

damon@coloradohousefinders.com
www.coloradohousefinders.com

Selling Your House During a Divorce

by questful | Jul 28, 2020 | Financial, Uncategorized

Moving home is a significant undertaking at any time, but when you are also going through a divorce there can be some additional issues to consider. Many couples will need to sell property during a divorce so it is important to think about how you will manage this process. You should also ensure that you get all the support you need, not only from your divorce lawyer, but also through selecting a trustworthy and experienced realtor and appraiser to value and sell your property.

Should You Sell Your Home When You Get Divorced?

Dividing up your assets is a key part of arranging a divorce. Since the marital home is usually the largest asset that you share, it is essential to think carefully about what will happen to it when you separate. Putting the property on the market is the most common option for divorcing couples in Colorado, but it isn’t always the right choice for every couple and you shouldn’t feel pressured to rush into a quick sale. Selling a home for the right price can take time and properties in many parts of Colorado are in high demand so there is no need to rush to find a buyer.

Most couples who are divorcing in Colorado will decide to sell their home and then split the proceeds. However, there are other options that you may want to consider. For example, one partner may be able to refinance the mortgage and buy out the other. You might also want to delay the sale, for example if want to keep the family home for a while in order to provide continuity for your children. The best option for you will depend on your personal and financial circumstances, so it is important not to rush into your decision.

You may also want to consider the local real estate market before deciding on the best time to sell. Take a look at the listings for similar properties and talk to a realtor to get an idea of how quickly you will be able to find a buyer. Get your property valued so that you know how much it would take to buy out your partner or how much you could each make if you sell now. You might decide that it is better to wait a while before selling, to rent out the property temporarily, or to make some improvements in order to raise its value.

When you are ready to sell your home, you should consider how you are going to manage the process while separating. Although your realtor will be able to help, there are some decisions that you will need to take together. You may prefer to do this in person or through an intermediary, such as your divorce lawyers or another neutral party. You can get advice on the process from your lawyers or a realtor who has experience managing property sales during a divorce.

Preparing to Sell Your Home

The basic process of selling your home during a divorce will be the same as at any other time. You will need to choose a realtor, have your home valued, arrange showings, and decide what to do when you get an offer. However, since you will be in the process of separating while all of this is going on, it is important to communicate with each other (directly or via your lawyers) and to make the important decisions early on.

One of the key issues that you will need to discuss is the price you are willing to accept for the property. Getting the property valued by a realtor will give you a good idea of how much you should expect to make. Your divorce settlement will determine how the proceeds from the sale will be shared between you and you can ask your lawyer for advice on this.

The valuation is a guide to how much your property is worth, but you will still need to consider what you will do if a potential buyer makes an offer on your home. You will both need to agree on how low you are willing to go if an offer below the asking price is made. Deciding this before you put the property on the market will enable you to negotiate more easily with the buyer when you receive an offer as you won’t need to take more time to discuss it between yourselves. Accepting a lower offer can help you to achieve a quicker sale, but it could also impact your budget for buying your next home so it is important to consider this decision carefully.

Another issue that you will need to decide on before you put the property up for sale is how you will manage the process. You will have various tasks to complete in order to find a buyer and arrange the sale. Depending on your circumstances, you may want to divide these tasks between you or for one of you to take on responsibility for the entire process. Among the tasks that you may need to complete are:

• Preparing the property for sale (e.g. conducting repair work, touching up the decor)
• Choosing a realtor and arranging the valuation
• Setting up viewings or open houses
• Negotiating with buyers who make offers on the property (via your realtor)
• Arranging removals and ending contracts for utilities etc when you move out

Once you have a better idea of everything that needs to be done, it can also be a good idea to talk about the likely timeline for the sale. Your realtor can advise you on how long it usually takes for similar properties to sell in your area, but you may also need to consider factors such as your children’s schooling or how long it might take you both to find new homes to move into. If one or both of you are still living in the property, then you will need to take this into account when arranging viewings or setting the completion date for the sale.

Although it is impossible to set a definite timeline for the sale of your property, it can be helpful to have some idea of the timescale. You can set targets for accomplishing some tasks, such as arranging any repairs that need to be done or getting your house listed by a realtor. Doing this can help you both to make plans for your futures.

Buying a New Home After a Divorce

In addition to managing the sale of your shared property, you will each need to think about your next steps. You may want to buy your own property, so you will need to look for a new home at the same time as you are selling. You will need to consider two key points while you are searching for property to buy if you intend to use the proceeds from selling your marital home.

Firstly, you should work out how much your shared property is likely to sell for and how much your share of the proceeds will be as this is likely to determine your budget for the purchase. You will also need to take a careful look at your credit rating and finances in order to set your budget. It is a good idea to talk to a bank or mortgage lender early on so that you have a reliable estimate of how much you will be able to borrow. You can then ask your realtor for advice on your property search.

Secondly, you will need to consider what impact the sale of your shared home could have on the timing of your purchase or move. You may need to move into temporary accommodation if you get a good offer for your current property before you have a new home to move into. Alternatively, you may need to wait to complete the sale on your shared property until you or your ex-partner is ready to move out.

The realtor who is managing the sale of your shared property will also be able to advise you on your property search and to guide you through the process of buying a new home.

Starting the Sales Process

If you are in the process of divorcing, then you can contact a realtor to learn more about your options or to take the first steps towards selling your marital home. It is important to get all the facts so that you can make the right decisions about when to sell. You will also need to get the property valued so that you both know how much you are likely to receive for the sale, especially if you will be using the proceeds to purchase your next home.

The process of selling your home during a divorce will be very similar to any other property sale, but your personal circumstances mean that it is essential to communicate well and to coordinate your efforts. Discussing the property value and timeline with your ex-partner at the beginning of the process will ensure that you both have realistic expectations. You may also need to divide responsibility for various aspects of the sale between yourselves, although your realtor will be able to manage much of the process on your behalf.

Selling your home is a major life-experience, whether you are going through a divorce or not. Having a reliable realtor who knows the local property market well can make all the difference. If you need any guidance on selling your joint property or you want to arrange a valuation of your home, then you should get in touch right away.

Damon Chavez, Realtor
10135 West San Juan Way, #100
Littleton, CO 80127
Phone: (303) 649-6767

damon@coloradohousefinders.com
www.coloradohousefinders.com