Handling the marital house during divorce is one of the most difficult parts of dissolving a marriage. Is it any wonder so many people make major financial and legal mistakes when it’s time to make decisions?
There are, in fact, many decisions to make. Will one of you keep the home or will you sell it? As real estate problem solvers, Houston Estate Services Home Buyers can help you evaluate your options.
Ability To Afford Your House During Divorce
You may not be able to afford to keep the house during divorce.
There are two reasons for this.
First, if you have a mortgage you might not be able to keep it. Unless the house is in only one spouse’s name to begin with, the bank approved the loan after taking the income of both spouses into account. The spouse who remains in the house will usually have to refinance the loan into his or her own name. Often, the remaining spouse is unable to qualify on the basis of a single income. You may be able to get around this by getting your ex to sign a quitclaim deed (see below), but if your ex is smart he or she won’t want to agree to that.
Even if you can qualify for the loan, you’ve got to decide whether or not you can carry a large mortgage on your own.
And if you don’t have a mortgage? Houses come with higher utility bills, higher upkeep bills, and a near-constant stream of maintenance expenses. Ask yourself if you can really handle it when the AC needs a $1500 repair or the water heater blows out. The home represents the largest percentage of most people’s budget, and divorce may be an ideal opportunity to downsize.
Be Aware Of Your Rights
You might not want to sign over your rights.
If you’re abandoning the home, you might not want your ex to stay there, even if they’re getting primary custody of the kids. As mentioned above, if your ex can’t afford to refinance but wants to keep paying the mortgage you may be asked to sign a “quitclaim deed.” If you do, you could be opening yourself up to a potential financial disaster, as Money Magazine reports.
A quitclaim deed is a legal way to transfer interest of real property. Signing this deed means the person is forfeiting their claim and right to the property. Signing this deed in divorce gives the other party full rights to the home, but your name still remains on the mortgage. You will still be held accountable for any missed mortgage payments and your credit score will be affected.
Remember, the deed and mortgage are two different things, and the quitclaim deed cannot remove your name or responsibility from the mortgage.
Another important thing to know about quitclaim deeds is that if you sign one, you are forfeiting the right to sell and profit from your home sale. For example, say you sign a quitclaim deed because your ex wants to pay the mortgage, but cannot afford to refinance. Now that your name is off the deed of the home, your ex can sell or refinance the house any time and will not owe you anything.
Should You Sell The House?
It may be best to move past the emotions invested into the home and sell it.
Indeed, this is often the scenario that the judge will insist upon. Your mortgage gets paid off. If anything remains you and your spouse will generally split the proceeds. Everyone loses the home, but everyone walks off into a new life with a fresh, clean start.
Usually this is the smartest and cleanest way to handle your home.
Consider Any Court Deadlines
Sometimes, judges give you a deadline.
When a judge forces the sale of the marital home, they may only give you 30 days to sell.
Given current averages in terms of how long a home remains on the market this would not be a very generous amount of time either in Houston, where home sales can take at least 30 to 45 days on average. This means selling through an MLS listing and a real estate agent may not be your best bet, especially if your home has liens or needs repairs.
Selling Options For House During Divorce
Instead, selling as-is to a real estate investor may be your best bet. Houston Estate Services Home Buyers, and other buyers like us, buy homes quickly. We issue offers in just 24 hours, and can buy the home even if it has issues. We help divorcing spouses resolve their property matters quickly. This way, they quickly comply with court orders and get on with their lives.
Are you getting a divorce?
Do you have questions about how Houston Estate Services Home Buyers can help?
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