There are a lot of issues to sort out in divorce, including the division of the marital assets. Of all the assets argued about during a divorce, the marital home is often at the top of the list. So, what happens to that home during a divorce? Is there any chance you could keep it?
The answers to those questions depend on many factors. In some cases, the couple may come to a decision on their own. If they cannot, a judge will consider the facts of the entire case and make a decision based on Michigan’s property division rules.
Who can Afford the Home?
If one spouse wants to stay in the marital home, he or she has to buy the other spouse out. The amount owed to the spouse moving out of the home is typically half of the equity in the home. Equity is determined by subtracting the amount of the mortgage and other debt on the home from the total value of the house.
For example, if a home is valued at $300,000 and the amount owed on the mortgage is $250,000, there is $50,000 worth of equity in the home. The spouse remaining in the home is required to pay the other spouse $25,000 for their share of equity. It is then assumed the spouse remaining in the home will continue to make mortgage payments, property taxes, and upkeep costs for the home.
In many divorce cases, only one spouse can afford to make these payments and buy out their spouse for their half of the home. It may seem as though a simple calculation can tell you whether or not you or your ex can afford to stay in the home. However, sometimes disputes arise when trying to determine the value of the home, and when determining when the buyout payment must be made.
Selling the Home and Splitting the Profits
A solution that seems much simpler at face value is to sell the marital home, with each spouse splitting the profits fairly. There are some instances in which this makes the most sense for a couple, such as when neither spouse can afford to keep the home. However, this scenario also presents several issues.
For example, if one spouse remains in the home during the marketing process, they could sabotage the sale. They may not perform proper maintenance to ensure the home is in the best condition possible, or they may even draw buyers’ attention to problems with the home. Selling a home and dividing the proceeds sounds easy enough, but it can also become complicated.
When You Cannot Reach a Decision
It is not uncommon for a divorcing couple to have trouble agreeing on the final terms of the divorce, and that includes those pertaining to the family home. When this is the case, a judge will decide. They will base their decision on many factors, including:
- The financial situation of each spouse
- The value of the marital home
- The contributions made by each spouse to the marital home
- The age and physical and mental health of each spouse
- Which spouse was awarded child custody
- Funds for the marital home, and where they came from
- Misconduct in the marriage by either spouse
- The employment and job skills of each spouse
If there are children in the marriage, a judge will likely award the home to the spouse with custody. Leaving the decision in a judge’s hands however, means you will have no control over what happens to your home. It is always best if the couple can come to an agreement on their own.
Need Help with Dividing the Marital Home? Call our Michigan Divorce Lawyers
Divorce is never easy, and emotions run high when discussing things like the marital home. This makes it extremely difficult for the couple to come to an agreement. A divorce lawyer in Michigan can help with this and all other aspects of a divorce.
If you are thinking of divorce, or the proceedings have already started, contact Iafrate & Salassa, P.C. today. We are here to ensure your rights are protected at all times and will negotiate on your behalf to get you the most favorable terms in your divorce. Call us today or fill out our online form for your free consultation to learn more about how we can help with your case.