Divorce brings with it many uncertainties, including where one spouse will live after the separation is complete. Not only is this decision an emotionally difficult one, it also has considerable financial significance. The party who gets the house in property division awards has to decide how to maintain the house, while the one who does not get it has to figure out alternate living arrangements. What a couple decides to do with their residential house depends mostly on what their future expectations are.
Couples can either sell the house outright and split the money, while others, especially those with younger children, may decide to sell the house later on. Someone with strong emotional attachment to the house may not want to sell it and may want to pursue sole ownership. The question that then arises is how to achieve this goal.
When deciding to buy out one’s spouse’s share of the house, the first step to take is to figure out the price of the house. As with any aspect of a divorce, it is possible to end up arguing over the cost of the house. One way to do this it to determine each party’s share in the equity of the house and then have one spouse pay out the other. Unfortunately, it is rarely ever a 50/50 split. What one has to pay also depends on who is paying loans, tax obligations from the transfer, and who is paying certain debts.
The next step is to come up with the money. This rarely means that the buyer spouse has to put the cash up front. Generally, he or she ends up giving the other spouse a share in some other marital asset, such as a retirement account or brokerage one. There are also other options, such as acquiring a refinancing loan or through a home equity line of credit. But it is important to keep in mind that reality and expectation may not always match, which is why some may have to give up ownership of a beloved residential home.
When going through a divorce, it is important to have an idea of one’s expectations for the outcome. Consulting an experienced professional for guidance on how to achieve those ends can prove helpful to Texan residents.
