Divorce in Washington can be very nerve-racking, especially when you consider your financial future. One of the biggest questions you might have is: “Who will get the house when we get divorced?” Your home is likely you and your spouse’s biggest asset, and you likely share the most emotional attachment to it, especially if you were planning on raising your children in it.
There are many ways that you can mutually benefit from splitting up the home. Many people during a divorce will feel more entitled to the property than their partner, especially if they were the one who put the most money and energy into it. Many times, the court will grant the home to the partner who obtains custody of their children. The displacement of the children is a big deal and can be emotionally damaging for them. It can also be very difficult for one of the partners to pay for the house alone after their ex moves out.
One of the simplest ways that the home can get split up is putting it up for sale. This way you can have liquid cash to walk away with and you might experience less burden this way, assuming, that is, you have equity in your home. Many people will not want to sell the home and will want an uneven split because they feel more entitled.
Also, many times one of the partners will have to buy out the other in the deal if they hold onto the home. Before you are able to split the proceeds of the sale then keep in mind that you both will have to pay off any mortgages, equity lines, sale fees, and capital gains tax, if applicable. One disadvantage you might experience is if there is a bad sellers’ market during the time that you are required to sell.
Despite this, there are many advantages to selling your home during the divorce especially being able to walk away from the deal with cash. You must be aware of the process to get your house sold.
First, you must pick the real estate agent that you want to work with. You will likely not want to sell the house without an agent during your divorce because it can add a lot of extra stress to the ordeal. You might want to hire the same agent that helped you buy the house if you were happy with them. You will want to make sure you pick an agent that is experienced and will work hard to get the best price possible for you.
Next, you will have to determine the asking price of your home; your agent will likely be knowledgeable of current market conditions in your area. If you think that their proposed asking price is not correct, then you might want to get a second opinion. You will then have to get the home ready for a showing. This might include having to do any necessary repairs, clearing out any clutter, and making sure the home will be desirable to a potential buyer.
When the offers start coming in then you will have to work together with your spouse to review the offers and come to an agreement of which one is the best. Finally, after the sale is complete you will be able to divide the proceeds. The escrow company can be the one to distribute the money between you and your spouse. If you have been paying off your mortgage during the sale process, then this will increase the amount of money that you will receive after you pay any commissions or closing costs. Sometimes, if the couple cannot agree upon the amount of money split, then this will have to be determined in court.
One of the more complicated ways that the home will be split between the partners is to do a buyout of the others’ interest in the property. Often, the custodial parent who cares for the children will be the one to stay in the home and do a buyout for the non-custodial parent, so the children will be able to stay in the home.
There are some advantages to this including being able to provide stability for the kids as well as not being forced to sell if the market conditions are bad. A buyout can occur over a period of time, because most people do not have the funds to completely pay off their spouse in the deal. Your buyout costs can be determined in your settlement agreement, but often it will be determined as part of your divorce settlement. The one who does the buyout will oftentimes obtain a new mortgage loan or by refinancing.
Sometimes one spouse will give up other marital property worth as much as their spouses interest. They may give up other marital investments or retirement accounts. Sometimes if one of the individuals is entitled to receive spousal support then the amount of support might be lowered in exchange for the equity in the property. When doing a buyout, sometimes the individual will have an issue with refinancing in their name alone; they should take that into consideration. The buyout will happen similar to doing a sale to a third party; your spouse will sign a deed transferring ownership to you. You will also want to make sure that the refinance is done before the deed is transferred to your spouse.
Another way that the property can be divided between the two of you is to set up co-ownership. Many times, if the individual who will buyout the other but cannot afford to do it all at once, then the two of you will co-own it until the final payment is made. The advantage to this will come into play if your still residing in your home with the children. Despite this, there can be many disadvantages to co-ownership.
You and your ex are still entitled to paying off the mortgage and it will often still be a large debt on your record; this can make it difficult when trying to obtain another home or other types of funding. You will also be at risk if your partner has late payments and it will end up putting the burden on you. The both of you must also decide how much of the mortgage and expenses you will each be responsible for. Another potential downside is that you will still have to be involved with your spouse.
This may not always be bad unless you feel that the emotional untangling will be more difficult; in this circumstance you should reconsider co-owning the property with your ex. You can also be at risk if your spouse decides that they want to move out or sell the property sooner than expected. Your settlement agreement should state a specific time that the house can be sold. You should always have a good settlement agreement so that you know exactly what will happen. This can include the sale date, buyout period, where the share will go at the partners time of death, or if they will stay in the house until the children reach a certain age.
Coming to an agreement might prove to be harder if you have a difficult partner; you may have to go to court and have the judge determine how you will split your property. The state that you live in will have its own laws about how the judge decide on who will get the house. Washington has community property laws; this means that any assets or debts acquired by either spouse will belong equally to both people. For example, if the property was acquired during the marriage, then each individual will likely be entitled to half of it; this also holds true to property that you brought with you into the marriage.
Some states have equal distribution laws which means that the court will divide the marital property evenly between the individuals, which unfortunately does not always mean a 50/50 split. The judge will categorize the property as marital or separate before anything is awarded. Under some circumstances, the judge will order that the couple will have to sell their property. There are many factors that will be taken into consideration during the court process. Many states will set up a restraining order that will prohibit either spouse from selling or obtaining a new mortgage on the property during the divorce process.
This holds true even if the home is in your name, you will not be allowed to encumber or sell the home without your spouses consent or court approval. Of course, the best scenario is if you are able to come to an agreement with your spouse over splitting your assets without having to go to Washington Divorce Court to do so. You should first create a list of assets and determine which spouse should receive it; then you can compare it with your partner to settle any disputes and work towards resolving them.
Each individual will have to be clear on all of the assets that were acquired during the marriage; this includes: any properties owned, bank accounts, retirements, vehicles, pensions, and anything else that has value. If you go to court and agree to a property settlement then it is later determined that one of the individuals did not disclose an asset, then you can request to have the judge reopen your case to do a reevaluation of the assets.
The individual who did not disclose may be subject to fines and penalties if the court believes that they intentionally did not disclose or hid information. You should always consult a professional when it comes to dividing your assets during a divorce. The best way is to hire a trusted divorce lawyer to help you navigate the process so that everything will be divided fairly