Getting the House: Financial Considerations When Negotiating Divorce Terms
Uncontested Divorce Mediation
Posted August 29, 2019
Television divorces and high-emotion separations both tend to emphasize the idea of “getting” things in the divorce without actually considering the implications of that “get.” One of the biggest mistakes that many people make in divorce is fighting for a house that you may not be able to keep either way. Homeownership that is undertaken as a couple is often based on your shared finances, job locations, chore distribution, and the life you’d planned to build together. Getting the house may feel like a victory but unless you are fully prepared for the financial and logistical considerations, that victory can quickly turn to ash (or in this case, debt) in your mouth.
If you’ve been thinking about ways to get the house in your uncontested divorce in Denver or worried that your spouse might get the house, this article is here to outline the details of what that actually means. And why so many couples wind up amicably selling the house and splitting the profits instead.
The Emotional Battle
Let’s start where most divorcing spouses start, at the emotional battle. Initially, many couples fight over who “gets the house” because it feels like a major victory that you can win. Really, this is a serious logistical and financial consideration that must be decided carefully. But your emotions tell you that the house is personal.
You Want “The Big Thing”
For spouses that are separating angrily, as so many do, it’s easy to see being granted homeownership as the biggest thing you can take from the other because it is the largest thing the two of you owned jointly. You’d like to claim it as yours and cackle victoriously from the rooftop as your uncontested divorce in Denver finalizes. We get it.
Your Kids Grew Up There (Or Live There Now)
Getting the house can also feel like the first step in the upcoming custody battle. After all, wouldn’t the judge want to leave the kids in their family home with whoever stays in the house? Not necessarily. It may feel that way, but having the home is not a guaranteed custody win.
Who Moves Out?
Then there’s that who-kicks-out-who battle. No one wants to feel like the person who was “put out” even if they initiated the divorce.
Expenses That Come With “Getting the House”
However, take it from experienced Denver divorce mediators getting the house is not always a walk in the park. In fact, victory is seldom as sweet as you imagine when it comes time to first buy your spouse out of the mortgage, then take over all the bills, expenses, fees, and taxes associated with homeownership on a single income.
When you get the house, you also get full responsibility for the mortgage. On the bright side, this might be your chance to renegotiate for a better interest rate, but that mortgage is still all yours. Including the newly non-shared debt load on your credit score.
Property taxes are all-too-easy to forget, but they are based on the value of your home. So if you have a nice house, property taxes monthly or annually can be a hefty cost to consider.
If your home is in an HOA, as so many are, that’s an additional annual fee for the privilege of using the sidewalks and playgrounds.
Bills & Maintenance
All monthly utility bills and all the maintenance from the air filters to the new roof the home needs next year are now on you, the sole homeowner.
Considerations for a Single Parent Keeping the House
Next. take the time to consider what it will really be like with the divorce terms you’re drawing up and life in the home where you were once married. Things can change significantly pre-divorce to post-divorce, with or without children. You might not even want the house after the high-intensity emotions of divorcing have faded.
Getting the House Can Mean Losing the Liquid Capital
Not only does getting the house come with all the home’s expenses. But you will likely be trading savings, retirement funds, and other forms of liquid capital that would be more immediately useful in return for the family home.
It May Be Too Big, Now
When you cut down your household size and reduce the activity, you may suddenly feel that the home is much too large for your newly private lifestyle. Even with children, what once seemed like spacious room to grow can seem overly large, echoey, and high-maintenance.
It May Not Be Affordable on One Income
When you stack all the aforementioned expenses and consider that you and your spouse were paying them together, the home can mount up to something that you just can’t afford now that you (and maybe your kids) are living on a single income.
It May Feel Wrong When the Family Splits
Some Exes even find that they are no longer comfortable living in the house once the family is no longer whole. Happy and unhappy memories alike can make the house you fought so hard to win not a relaxing place where you can really feel at home.
House-Getters Often Sell Anyway
All of these factors come together and very often result in the house-getter choosing to sell not long after “winning” the home in their divorce terms. In the long-run, you may have been better off splitting the retirement funds instead.
Logistical Considerations When Selling the House
Finally, there’s the alternative which comes with its own set of financial and logistical considerations. Should you choose to sell your shared home instead of giving it to a single spouse, this gives you the opportunity to split the profits and keep your divorce terms far more balanced in every other way. Of course, there are a few challenges along this path, as well.
Expense of Renovations
Considering that you are already going through uncontested divorce in Denver, the expense of updating and staging the home for sale may seem excessive. Many spouses selling their home to divorce may even take out a temporary renovation loan which will be paid with some of each profit share of the sale.
Ongoing Expenses While Selling the House
Don’t forget that you will still be paying the mortgage, tax, utilities, and fees until the home sale is finalized with a new buyer.
Finding New Places While Selling the House
One of the biggest challenges of selling a home for divorce is the fact that both spouses need to rapidly find new separate places while the home is staged and sold.
Realistic Expectation of Final Profits to Split
Don’t forget about closing costs before you start making plans for your share of the sale profits. Closing costs include realtor and lawyer fees, title services, filing fees and usually a few other costs thrown in for good measure. Only after all expenses, including any renovation loans, are paid can you and your spouse split the final profits and complete your financial separation from each other.
Contact Divorce Mediators in Denver Today
Is “Getting the House” really worth it to you? For some divorcing spouses, the answer is still an absolute yes. But many others quickly realize that the sentimental value of the house is meaningless if you wind up selling it a few months later due to mounting expenses, maintenance, or personal discomfort. A Denver divorce mediator can help you carefully walk around all the possibilities, financial and logistical, of every divorce term you discuss. Contact us today for professional guidance in making this very important decision in your divorce terms planning. Contact Split Simple today for help navigating your divorce in Denver today.
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