![]() By Marc Demetriou, CLU, ChFC, CDLP, SVP of Mortgage Lending/Branch, Manager, Guaranteed Rate In the 1980s, the mainstream media shockingly reported that half of American marriages ended in divorce. Now forty years later, there’s some good news and bad news regarding divorce stats. The good news is divorce rates are down, from approximately 50 percent to 39 percent in 2020.1 The bad news is the divorce rate in America is still too darn high. Which means that there’s still a lot of heartache and a lot of broken homes, literally and figurately. So, how do divorcing families deal with a divided house while also trying to sell it? Each state makes its own rules As anyone who has ever been through a divorce knows: there are no “typical” divorces. For example, if you live in a “community property” state, assets that were accumulated during the marriage are split fifty-fifty. But as they say: “the devil’s in the details.” If your spouse moved into a home that you already owned and the spouse’s name was never added to the house’s title, things could get complicated in a divorce. Community property states include Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin, and sometimes Alaska. In the remaining 40 states, marital assets are distributed in a relatively fair manner. But sometimes “fair” is not the same as “equitable.” Judges are human, with human frailties and biases. And let’s not even talk about prenups. If a spouse signed a pre-nuptial before saying “I do”, most judges will treat that agreement as a legal document. Judges love documentation. It’s less work for them. The three main options for selling the marital home Many real estate and financial experts say that there are three main ways3 to divide property in a divorce:
Other joint decisions are crucial as well There are other decisions5 that need to be resolved jointly that will directly affect the sale of the marital home as well, such as:
Divorce can be a painfully emotional process for all concerned. But keeping a level head, being pragmatic, and maintaining reasonable expectations can help ensure that neither spouse loses their shirt when the martial home is finally sold. Again, consulting a tax attorney (especially one who has experience working with divorced couples) can help both parties move forward with open eyes.
Marc Demetriou “The Divorce Lending Expert” is an SVP of Mortgage Lending & Branch Manager at Guaranteed Rate and is currently licensed in all 50 states successfully serving his clients in traditional and reverse mortgages. He consistently ranks in the top 1 percent of mortgage originators in the U.S., according to leading industry sources Origination News, Mortgage Executive and Scotsman Guide. In his home state of New Jersey, Marc has been featured in NJBIZ's "40 Under 40" and is called upon frequently by the real estate, finance, accounting and legal communities as a trusted expert and speaker.
2 Comments
Leave a Reply. |
Guest Blog
Archives
July 2024
Categories |