Lately I have had several calls with clients who had questions about the issues that come up on whether to sell or keep the home during divorce.
The issues have been that one spouse wants to keep the home while the other one wants to sell it. It is a fairly common issue that will have to be decided before the divorce can be finalized.
The two main things you should look at to help you come to a decision is 1) Can the spouse who wants to keep it, afford it and 2) If you can afford it, how are you going to offset any equity share that will be going to the other spouse.
What we find is that most clients cannot afford to keep the marital home. The home is either too expensive and requires the income of both parties to make the payment or the home is entirely too big. You don’t need a 5 bedroom home when you are going from 3 kids and a wife to just you.
I think there sometimes is just a tendency to not want to give up those things that were acquired during the marriage.
Regardless of the reasons, you and your spouse will have to look at this and be reasonable in your decisions. It may be hard, but if someone wants to keep the home, you have to make sure you can afford it and everything that goes along with it such as repairs, property tax and insurance.
The best way to keep the house is to refinance the property and pull any cash out if you are dividing this asset. This is the only way to totally remove the other spouse from the loan and from title.
While is is possible to remove one from title only via a quit claim deed, doing so leaves you on the loan and open to possible negative credit rating if your spouse failed to make the mortgage payment. In addition, it may make it more difficult to purchase another home if the existing mortgage shows up in your credit history.
We specialize in divorce in California. If you have any questions about divorce please feel free to give our office a call.