When a couple has decided to separate it opens up a myriad of difficult decisions and discussions, not least of which is whether to sell the family home. If neither partner wants to stay in the house after divorce or one partner can’t afford to buy the other out, it may be a good option to sell the property and divide the proceeds before the divorce is finalised. Bear in mind, however, that just as there are many advantages to selling during the divorce proceedings there are also disadvantages to consider.
Advantages and Disadvantages of Selling a House During Divorce
Before making a decision as important as selling the matrimonial home, you should consider all the issues involved so that you can make an informed decision.
One of the most important advantages is to free up cash for both spouses to start over again. If this is a genuine desire it is important to work together on the outcome. If there is no agreement on the terms a court will have to decide the outcome on your behalf which is not always a good thing.
Another advantage is to get this important part of divorce out of the way before the divorce is finalised as a “former matrimonial home” can become a major bone of contention that can drag on for many years.
The market conditions may not be conducive to sellers to get the best possible price at the time of the sale. Before the proceeds of the sale can be divided the mortgage and any equity must be paid off as well as any capital gains tax that may apply. You will also have to pay the broker’s fees and other charges involved with selling a house. If there are children involved, uprooting them from their homes when they are already having to adjust to the many changes that are taking place in their lives can be seen as a disadvantage.
Once you and your spouse have come to an agreement to sell, you will be faced with a lengthy process that involves many steps and agreements. At the best of time, this takes hard work and the emotional stress that comes with going through a divorce can make the process even more difficult.
Steps to Take When Selling a House During Divorce
- Choose the Method of Selling
Contact your family law solicitors and legal aid Penrith to help you choose the best way to sell your property and ensure that the title deeds are in a secure location. Your options include selling on the property market, on auction, or through a quick sale for a cash company. A solicitor can also help you come to an agreement regarding the financial obligations and any other payments that need to be deducted from the final proceeds of the sale. For example, if one spouse has been paying towards the mortgage for a period of time before the sale has been concluded the amount will have to be calculated or any marital debts both spouses have agreed to be paid from the proceeds of the sale.
- Choose the Right Real Estate Agent
If you have decided to sell on the property market it is in the interest of both spouses to come to an agreement quickly to avoid adding unnecessary stress. Try to find an agent who has had previous experience in selling property in divorce situations.
- Have the House Evaluated
Once you have an idea of how much the property is worth you can put the property on the market and get the house ready for showings. Consider the agent’s advice on the asking price to eliminate any potential conflict. If both spouses agree that the agent’s opinion is off base, it may be time for a reality check or you can find a different agent.
- Reviewing Offers
It is important for both spouses to work together when reviewing offers. You can take the advice of the agent; however, the ultimate decision will have to be taken jointly.
- Dividing the Cash
After paying all financial obligations related to the sale of the property the escrow company will distribute the proceeds of the sale evenly after all financial obligations have been deducted.
Selling a house during divorce is a good option if both spouses agree not to carry on living in the matrimonial home after the divorce has been finalised. It is one of the most cost-effective and amicable ways to conduct a non-contested divorce as it saves a lot of time and money.