When trying to figure out whether to keep the marital home as part of the divorce settlement, there are several things to consider. Below, we explain some of the options divorced couples have when it comes to deciding what to do with their marital home post-divorce.
#1: Refinancing
If one of the spouses is awarded the marital home, they will have to refinance the mortgage to get the other spouse’s name taken off the property deed. If the mortgage remains in both spouses' names after the divorce, and one stops making payments, then the other spouse named on the deed is liable for the penalties. However, refinancing a mortgage loan is costly, especially if the mortgage is underwater. You should consult with an experienced lawyer to discuss if refinancing is the right option for your situation.
#2: Turn it into a Rental Property
Some people choose to turn the marital home into a rental property. Going this route means they also have to take on the responsibilities of a landlord and ensure everything is functioning properly for the tenants. Being a landlord will also require you to look into whether your homeowners’ insurance covers rental properties. You will also have to acquire the right permits, determine a fair rental rate, and find a trustworthy tenant.
#3: How Much Will It Cost Annually to Own the Home?
In addition to paying the mortgage and property taxes, there is much more to owning a home that you need to account to make sure you can afford it. Consider the following factors of homeownership to calculate your annual expenses:
- Monthly Utility Costs
- Landscaping
- Property Maintenance
- Seasonal Expenses
- Appliance Repairs
- Weather Damage
Before you decide to keep the marital home, you should first have a property inspection conducted so you know what you might be getting into.
McKinley Irvin’s experienced lawyers are available to answer your questions regarding property division. To discuss your case with a compassionate legal professional, please schedule a consultation.