Selling a house at the best times is never easy, so if you are going through a divorce and trying to sell a house that is jointly owned with your ex-partner, the process is only made even harder and more emotional.
While keeping the house is always an option, most couples going through a divorce will find they wish to sell the property in order to make a fresh start. A key deciding factor in whether a separating couple may decide to sell their property is whether there is an outstanding mortgage and how much is remaining. Affordability, as well as how much equity is in the home will also be crucial.
There are multiple ways to go about selling a property when going through a divorce. Each has its own benefits and disadvantages, and some will be better or worse depending on your own situation. Selling a house when divorcing is never easy but understanding your options and knowing what is best for you can certainly help ease the process.
Selling the Property and Taking the Money Out
Although this can cause disruption and stress (especially if you have children), selling the house, splitting the money and moving is often the best way to get a clean break and move on with your life. The house can be put on the open market, and if it has been the family home you can take out the proceeds tax-free. You will then be able to buy two separate homes and get the fresh start you need.
One Spouse Pays the Mortgage and Takes Ownership of the Property
In this instance, one spouse would continue to pay the mortgage (provided they are financially able to do so), meaning they would have to continue to pay the mortgage payments by themselves but would later benefit from owning the house outright.
If you have children, this option provides more stability for them, meaning they will be able to continue living at the property and not have to move schools etc.
Both Spouses Pay Off the Mortgage and One Moves Out
This is sometimes more feasible due to many couples funding their mortgage together based on two separate incomes. This will mean you will both jointly own the house when the mortgage is paid off but could make things difficult in terms of deciding who moves and how much each spouse pays towards the mortgage being paid off.
One Spouse Buys the Other Out
Another easy option for a clean break, while preserving a more stable environment, is for one spouse to buy the other out if they have the money to do so. The spouse staying at the property will usually be the one who buys the other out.
The spouse that is bought out can then use this money to take out another mortgage or rent.
An agreement can be put in place to ensure any equity gains are passed down to children.
Transfer a Share of the Property to the Spouse that Moves Out
This not only minimises disruption but means that both spouses can benefit from any equity gain while minimising disruption. Who gets what share and how the mortgage is paid is up to you to decide however this is legally binding and neither party can pull out of the arrangement. If the marriage has broken down to a point where communication is difficult, this may not be the best option.
This article was written by an online estate agent House Sales Direct. If you wish to sell your house fast and for free, then head over to the House Sales Direct website for more property related information and enquiries.