Deciding what to do with the marital home is one of the most significant and emotionally challenging decisions you’ll face during a divorce. This decision isn’t just emotionally driven—it’s also financially complex.
Whether you’re leaning towards selling or staying, there are key questions you should ask yourself to guide your decision.
Realistic questions to ask yourself
Determining to keep or sell this marital property is not a decision to rush into. Before deciding, consider asking yourself these five questions:
- Can I afford the ongoing costs? Meeting mortgage payments is just one part of home ownership. Other expenses like property taxes, utility bills and maintenance costs can add up. It’s essential to ensure you can manage these costs with only a single income.
- Can I qualify for a mortgage on my own? If you decide to keep the house, you might need to refinance to get your ex-spouse’s name off the mortgage. This means you’ll need to qualify for the loan on your own. Your ability to qualify for the loan may depend on your income and credit score, so it’s something to consider carefully.
- How will keeping the house affect my financial goals? Will keeping the house prevent you from achieving those goals? The money tied up in the house won’t be available for other uses unless you sell the house or borrow against the home equity. So, it’s important to consider your future financial plans before deciding.
- What are the tax implications? Selling a house can have tax consequences, particularly if its value has increased since you bought it. Understanding this is important when deciding whether to sell or keep it.
- What is the potential for its appreciation? Consider whether your house’s value might increase over time. If the housing market looks promising, it might make sense to keep the property. However, selling could be a better choice if the market is sluggish or likely to decline.
Positive answers to these questions might suggest that keeping the home is a suitable choice, especially if it gives your children the stability they need. However, if maintaining the home could lead to financial difficulties, selling might be best.
Look for the right assistance
The final decision to keep or let go of your marital home will impact not only your financial circumstances but also your children’s lives. So, consider consulting an attorney to fully understand the impact of your decision.
