With housing prices soaring, you may be loath to let go of the family home in your divorce – but is it wise to try to hang on?
Homes can hold significant emotional value for a lot of people, which can make them contentious parts of the property division process. While keeping the family home might seem like a way to maintain stability, there are several compelling reasons to reconsider:
1. The cost of ownership may be more than you can handle alone
The mortgage, taxes and insurance may be difficult enough to handle on a single income – but you also have to think about ongoing upkeep and regular repairs, as well as the occasional emergency issues that have to be handled with broken appliances or roof repairs.
2. You may have difficulty financing the home in your own name
Unless you have a very accommodating ex-spouse or minor children are involved, the odds are high that your ex will want the house financed out of their name. This relieves your ex-spouse of ongoing financial liability tied to the home and allows you to “buy out” your spouse’s share of the equity. Unfortunately, you nee sufficient income and credit to secure the mortgage, and that may not be easy on your own.
3. You may not want your own assets tied up in the property
Keeping the home generally means giving up assets and putting all of your financial “eggs” in one basket. This can make it harder for you to remain financially flexible for the future. You may also need to trade off other valuable assets against your spouse’s share of the home’s equity (depending upon your situation), and that could deplete your retirement accounts and investment portfolios.
When approaching the property division process in your divorce, it’s always important to assess your future goals and priorities. Legal guidance can make it easier to understand the ramifications of your choices.