It is unfortunate, but in today’s society, over 50% of Americans’ marriages end in divorce. With divorce, comes the splitting of assets. In this article, we will look at the process of selling your home in a divorce and how to save time and money in the process.
It is important to note that in the state of Texas, all assets in a marriage are considered “community property,” with few exceptions. If you owned the property prior to the marriage, or if you inherited or were provided a property as a gift during your marriage, the asset is considered separate property. However, if any funds were used from a shared bank account to make improvements on the home, then the home becomes community property. Any community property is essentially shared equally between you and your spouse. All in all, it can be challenging to prove that an asset is separate property.
Knowing that, we can assume that the home you are trying to sell in your divorce is actually the property of both you and your spouse. Now – let’s get started with your options on how to handle a home while getting a divorce.
Option #1: Sell the House During the Divorce
This option is best suited for those couples who are facing financial restraints and need the income from the house. If the divorce is ugly, this is also a good way to cut ties more quickly, providing spouses relief from the other; in this scenario, each person gains the opportunity for a fresh start.
On the other hand, selling a house during a divorce may not always be the best option. If it is not a seller’s market, the couple may lose money on the home. They will also need to agree on the selling price and pay the fees for an agent and attorney. Selling the home also removes the security from the children – they must start anew somewhere while dealing with their parents’ divorce. Also, if the couple opts to sell the home during the divorce, they must hope for a good market. The divorce will not be finalized until the home closes and profit is split accordingly.
Option #2: One Spouse Buys Out The Other Spouse
If one spouse can afford to buy the other spouse out, this may be a viable option. Sometimes, a parent will stay in the home to provide comfort for their children during the divorce. The pros that accompany this option are plentiful; however, most couples are not in a financial position to do this. Additionally, if the divorce is hostile, the agreed-upon price may be challenging to find.
Option #3: Postpone Sale until After The Divorce
If both parties are in a financially secure position, they could opt out of selling the home immediately and agree to sell it after the divorce is finalized. Both parties would have to agree, and, in the final decree of divorce, they would have to state the terms of selling the home, including time frame and price. This can speed up a process and provide an agent time to adequately market the home.
The downside: In a contentious situation, this option extends the relationship by requiring continued communication. Although documents may be signed, one spouse could change their mind and can bring the other spouse to court, creating more required legal action and additional fees to be paid. This can be harmful – not only to one spouse, but also to the children.
HIDDEN Option #4: Sell The Home to an All Cash Buyer
If the divorce is ugly and hostile, you may want to sell the home as quickly as possible. It may be better to cut ties now than to drag out a toxic relationship. To sell quickly and smoothly, it may be best to sell your home to an all cash investor who is educated in the industry.
We here at Gulf State Homebuyers purchase homes during divorces, helping our clients transition more quickly. As a company, we help our clients save time and money, allowing for them to move on and settle into that new life they are hoping for. Our services include:
- We cover closing costs – we buy the home “as-is,” and we don’t ask for additional financial coverage. Also, there is no agent to pay on these transactions.
- We have an attorney on staff that completes paperwork – we cover these attorney fees.
- We close quickly – with our all cash offer, we can close in as quickly as five days, separating the hostile relationship sooner rather than later.
For more information, contact us today!