A divorce can bring major changes to almost every part of a family’s life. One of the biggest questions may be what happens to the home where the family has lived.
When both spouses want to stay, deciding what exactly happens next can be especially difficult. The answer may depend on the couple’s finances, the value of the property and what arrangement makes sense for their specific situation and future.
Options for handling the family home
New Jersey uses an equitable distribution approach when dividing marital property, which generally means property is divided fairly based on various factors rather than automatically split 50/50. When determining how the home’s equity should be divided, factors such as each spouse’s financial contributions, economic circumstances and other relevant considerations may come into play.
One option is to sell the home and divide the proceeds between the spouses. This can provide a clean break and allow both people to move forward with separate housing. Before selling, the spouses may need to consider the mortgage balance, the home’s current value, closing costs and how any remaining equity will be divided.
Another possibility is for one spouse to buy out the other’s interest in the property. However, being able to afford the home on one income is an important consideration. The spouse keeping the home may also need to qualify for a new mortgage and take responsibility for future property taxes, repairs and other expenses.
In some situations, spouses may temporarily continue to own the home together. This arrangement may give one spouse time to find new housing or allow the family to remain in the home while children finish a school year. However, co-owning property after a divorce can create ongoing financial and practical issues. A clear agreement should address who will make mortgage payments, cover repairs and expenses and decide when, how, or if the home will eventually be sold.
When neither spouse wants to leave the family home, there can still be ways to reach a workable arrangement. An experienced legal professional can help you understand your options, evaluate the financial issues and create an agreement that protects your interests as you move forward.
