During divorce, one of the most important assets to receive a great amount of attention promises to be the family home. The family home not only contains a great amount of history but also a great amount of significant value in equity.
Naturally, what happens to the family home sometimes remains a contentious aspect during divorce proceedings. A few potential scenarios exist related to the outcome of the family home. Some are more realistic than others.
Refinance, sell, buy out equity share
Here are some of the options as to what may happen to a home during divorce:
- Refinance the home under one name: This can only take place by removing the name of the departing spouse from the loan as well as the home’s title. Remember, though, that lenders may be apprehensive as a formerly two-income family transforms into a one-income family. Lenders want to make sure that you can afford the home on your own.
- Sell the home: The divorce agreement may stipulate the necessary sale of the home and the division of the profits made from the sale. This may be the only option when both spouses cannot afford to make mortgage payments on their own.
- Buy out the other spouse’s equity share: This option is possible as long as the spouses agree and the spouse doing the buying can qualify for a new loan.
Some of these options may rise above others in being the right choice.
Gaining direction from an attorney
Granted, it will not be an easy decision to make regarding your home, but you must choose an option that best fits your specific situation. Gaining direction from a skilled attorney will help. An attorney will team with other professionals such as a mortgage broker and financial planner to direct you toward the best decision.