Which House Option is best for you?
One of the largest assets you own, and likely debt that you have, is associated with the family home, in Family Law referred to as the matrimonial home. The treatment of this asset in the divorce is one that has a significant impact on your financial life post-divorce. As such, all financial scenarios of the financial piece of the divorce should be investigated and carefully considered. From the decision standpoint, you really only have two (2) options. The first one is that one of you buys out the the house ownership from the other. The second option is to list and sell the matrimonial home.
The decision about a buyout or selling can be a simple one once you know how much money you would need to come up with (value of home less mortgage less any equalization payment) to buy your spouse out of their interest in the home. If neither of you can afford to buy out the other, then you will need to sell the home. However, if one or both of you can afford the house, then the choice is less about finances and more to do with emotions, post-divorce living, and practical arrangements, (for example, age of children, where the children go to school, children’s activities, caregivers, where each of you work , transportation options etc.)
The transition year from married to divorced is a challenging year, so as much ease as you can plan for is beneficial. When considering your house options, don't forget to add to your list the ease, each option affords you in carrying on post-divorce life. First, gather and work out the numbers for each option. It is best if you to allow each of you to do your own individual assessments and conclusions. Resist the temptation to do this for your spouse. While you may be well-intentioned, it is most often not perceived this way or received the way you would have imagined. Next you will assess which option also works best in conjunction with the other terms of your separation agreement. Once you have looked at the financial, emotional & practical elements of your preferred choice you can reasonably discuss with your spouse. Sometimes these meetings can become emotionally-charged with can make the issue more complex than anticipated, I invite you to resist the temptation to leave/vacate the home believing this will be helpful in reducing the emotional stress. It is however a short-lived escape unfortunately and unfortunately makes it more difficult to get to resolution and the hoped for amicable divorce hoped for perhaps now not possible. Financial divorce mediation can help in facilitating your assessments of the financial scenarios and the resolution to be included in your separation agreement.
Final Word: While you may love your home, and most of us do, reflect about this: "houses are only bricks & mortar; but any house can be home as home is where the heart(s) is(are)".