Divorce – How to Sell your Home Without War
Alberta has the highest divorce rate in Canada. Divorce is a very traumatic time for couples as emotions are riding high. There can be many very bitterly contested issues that arise during divorce proceedings. Your home is often the biggest financial investment that you made as a couple in happier times. Quite often, when a married couple decides to split, one partner will continue to reside in the home at least for the short term. How is the best way to sell a house so you can both equitably profit instead of making the lawyers richer?
Deal with your emotions before you decide what to do. The first thing to remember is not to base your decision on what you're feeling. Since your home represents a considerable investment, be smart in how you make your decision. You have to try and accept the situation and take charge of your emotions. If you have children, then their needs should come first above all else. Remember the little ones and think about what's best for them.
Use your real estate agent and lawyer to fully understand your options and the pros and cons of each choice. You both need to make an informed decision. Neither of you needs to make your home a battleground where you both can needlessly end up losing a lot of money. Discuss it with your partner to consider these options and if possible, agree on a cooling off period so you both can make your decision both rational and equitable.
The decision is to sell the house only entails so many choices, so what do you have to consider? A divorcing couple basically has 3 options.
Both Parties Mutually Agree To Sell The Home
Agreeing to sell the home doesn't have to occur immediately. Essentially you both agree to sell the house and split the proceeds from the sale. If you choose to do so, decide on a timeline and involve a realtor so that you make the maximum amount of profit from the home. The main benefit is that it gives both of you a clean break and some equity to start you new lives apart.
Sell Your Half To Your Partner Or Buy Out Your Partner
You either agree to sell out your share of the investment of buy your partner out. This also should be done using a realtor that you both agree to use. To do so amiably, you have to look at how much investment is required if one of the spouses decides they want to keep the home. More importantly, the person who is buying out the other needs to consider their current and future financial situation to ensure you they manage the investment. Again, your realtor can advise on how much this investment will entail.
Maintain Joint Ownership of the Home
Occasionally, the real estate market can be depressed and home prices may have dropped. This often happens during a recession or when the housing market experiences a readjustment if prices have become inflated. It might not be a good time to sell, and since neither of you wants to lose money, why not hold onto to it for awhile and sell when home prices have improved?
Putting a Lien on the House When Getting a Divorce in Lieu of Selling
When you decide that your ex is going to live in the marital home but you are entitled to a sum of money, you can place a lien on the property instead of selling. If you have children together and they are going to remain in the home for the majority of their time, a lien protects your interests without having to sell the home. Once you have a lien, your ex will have to pay you before they sell, take another mortgage on the property or try to transfer it. While you also have the option of foreclosing on the property if the debt to you hasn't been paid, this is usually a last resort when your children are still living in the home. If you don't need the money, this can be a great way to protect your asset while allowing your children to remain in the family home.
Whatever you do, don't use home as the battleground because neither one of you will likely win in the end.