Purchasing a home is a main economic goal for many people. They want to stop paying rent and to accumulate equity. Married couples are often in a position to combine their resources and make that dream a reality.
The home where a married couple has lived together can become a source of disagreements when they decide to divorce. Many couples end up fighting over who stays in the marital home and who leaves.
Before determining that staying in the home is the best option available, people preparing for divorce may want to ask themselves the three questions below to ensure that staying in the home is the best choice.
1. Can I afford the home?
The most important consideration when seeking to retain a home is whether or not it is financially viable to do so. A home that was affordable for a married couple can be prohibitively costly for one spouse after a divorce.
A spouse’s income and credit score can influence whether or not they can reasonably afford the marital home on their own. Not everyone can qualify for financing without a spouse, and monthly payments might increase due to the lack of a cosigner or the need to withdraw equity.
2. Can I maintain the home?
Married couples usually share the tasks associated with home maintenance. One spouse may do much of the cleaning and decorating, while the other may maintain the yard and mechanical systems within the home.
Those raising children or working full-time may not have the capacity to handle all of the maintenance responsibilities that come with home ownership. They may also struggle to afford professional services for those tasks. People need to realistically explore whether they are in a position to maintain their homes.
3. Do I want the house or just the equity?
People often seek possession of the home because it is their most valuable asset. However, they may care more about the value of the home than actually staying at the property.
Thinking carefully about this last question is important. Each spouse theoretically has a right to a fair share of the home equity. Staying in the home does not mean that one spouse gets to keep all of the equity. They either withdraw equity to compensate their spouse or make concessions in other aspects of the property division process to balance out their retention of the marital home.
People who set reasonable and practical goals during divorce can focus on the big picture throughout the property division process. Deciding whether staying in the home is the best option can help people begin planning for the future.