What To Do With Your House During California DivorceFriday, April 14th, 2017
What To Do With Your House During California Divorce
When going through a divorce in California you will need to decide what to do with your home. There are only a few options you have. Sell, Buyout or Keep. I explain what you need to consider in this video. (More Below Video)
I have found that with many divorce cases I handle in California, that many times one spouse wants to keep the house. This seems to be their hope even when it does not make sense financially in some circumstances.
Let’s explore the options with your home during a California Divorce
Sell The Family Home
Probably the easiest way to deal with the family home during a divorce is just to sell it. If you have equity in the home you can split the proceeds which may give you the needed “getting started” money to move and either purchase a new home or to have the money to put down on a rental.
In most cases it is likely that the family home is more home than one person needs unless there are children involved which you may want to keep in the home.
One Spouse Keeps The Home
I have had numerous clients work out a deal where both spouses decide to keep the house with one of them staying in the home. This is usually done when there are minor children still in the house and the parents want to maintain continuity for the children and stay in the home until they have at lease graduated high school and then they will sell the home at that time.
Buyout Of Family Home
The last option is a buy out of the home. In this case one of the spouses is deciding to stay in the home and have it confirmed as their sole and separate property. This is possible by either refinancing the loan into their own name and taking some cash out for the buyout.
In the alternative, if refinancing is not an option, perhaps there is another asset such as a 401k or pension that can offset the value that should come from the home.
For instance, let’s say that there is $100,000 in equity in the family home. So each spouse would get $50,000 if the home was sold. If one spouse wanted to keep the home, look for another asset that may offset this.
Let’s say that the spouse not keeping the house has a 401k with $50,000 in it. Well, in this case the spouse with the 401k could keep the entirety of it and the spouse could keep the home and the asset division is equal.
You don’t have to sell everything in a divorce. You can use equity from all assets to work towards an agreement that is fair to both of you.