Your home was your castle. Maybe it was the perfect downtown loft for a career couple or a family home where you watched your kids grow. Perhaps it was the condo where you moved after the kids left so that you didn’t have to worry about mowing the lawn in the summer or shoveling the snow during an Ohio winter anymore.
But now that you’re divorcing, what happens to the house?
There are options. You could arrange for one ex-spouse to keep the property and buy out the other one. Or, you could agree in the divorce that one spouse will stay in the home for a specified time for the kids’ sake, especially if the children are close to graduating from high school, for example.
Or, you could sell the house. But will you each walk away with the same amount?
Typically, yes, but circumstances could exist that could leave one spouse with more money than the other.
Say, for instance, when the couple bought the house, the new wife contributed $40,000 from an inheritance she received from her grandparents for the down payment. The new husband didn’t put anything toward the purchase price when they bought the house, which cost $200,000.
Fast forward 10 years, and the house has appreciated. After the remaining mortgage and all fees and commissions are paid, the couple receives a check for $88,000 in proceeds from the sale. Each gets $44,000, right?
Not necessarily. Even if they bought the property after they were married, the wife could have greater interest in the home. If she has the records that prove where the $40,000 came from for the purchase, she could be eligible to make her own claim on the equity, even if the couple didn’t have a prenuptial agreement. In that case, she could ask for the $40,000 to be taken off the top of the proceeds, meaning she’d walk away with her initial contribution plus half of the remaining balance.
Divorces can be emotional and confusing times. Before dividing up significant property holdings, such as your home, a family law attorney can help make sure your assets are protected.