How Do I Go About Keeping Our Home After the Divorce?
When it comes to advising clients going through divorce in Florida, given that the family home is usually the most valuable asset for them, I spend a significant amount of time discussing whether or not the clients want and can keep the home. While, of course, for many, the home is of sentimental value, it is also a major financial decision, and should not necessarily be pursued if it is going to be a financial, unsustainable burden that prevents someone from moving on with their life.
If, however, you have already decided that you want to keep the family home, there are a number of steps you should take to achieve this, as discussed below:
Figuring Out Cost
First and foremost, you have to figure out how much it will cost to hold onto it. Even if your spouse indicates that it is OK for you to purchase their half, you will still need to prove that you can do so, and agree on a fair value. This is typically done by figuring out what the amount of equity in the property, which is usually the house’s value minus what is still owed. Divide it in half, and that is each spouse’s share of the property. However, this still doesn’t address other issues, of course, such as who will be responsible for the tax obligations, debts, loan fees, etc. Keep in mind that these amounts add up quickly.
Coming Up with A Buyout
Next, you will likely need to figure out how you can buy out your spouse’s share of the home, as most people cannot come up with that kind of money by simply selling some of their belongings and/or cashing in on investments. What many people decide to do is trade another asset into their spouse exchange for their half of the home, such as a portion of their retirement account, or even interest in another property. Others might perhaps borrow money from the bank or refinance their home, although it is important to first fully understand the interest obligations that accompany a loan like this. Also keep in mind that you would need to get pre-approved first.
Another option is to take out what’s known as a “home equity line of credit” as a second mortgage. These operate similar to credit cards in that they are revolving and thus keep your monthly payments low. However, keep in mind that they also carry higher interest rates than your first mortgage, and can also vary from month-to-month.
And some people are fortunate enough to perhaps have family and friends who are able to help them out financially. However, also keep in mind that a number of people simply come to the conclusion that it is simply too difficult financially to keep the home, and they want to move on without the financial burden.
Contact Our Florida Divorce Attorney to Find Out More
If you live in Florida and have questions about divorce and property, contact our experienced West Palm Beach divorce attorney at the office of William Wallshein, P.A. today for a free consultation.