Should We Sell The Marital Home?


One of the many major questions clients have when they come into their attorney’s office is, “What do we do with the marital home?” There are several options, and depending on your particular circumstances an attorney can help you understand which one is right for you.

In order for your attorney to give you the best advice for you, there are a few questions they should ask you in regards to your marital home. Was it purchased prior to or during your marriage? Is title held in both of party’s names? How much equity is in the home versus how much is owed? Was the down payment a gift from a family member? If so, do you have a Promissory note for said gift? We’re improvements made to the home with separate property funds?

When you meet with your attorney, it will help to have a copy of your most recent mortgage statement and a copy of your title document. From there, your attorney will help do a calculation in order to help you determine the next course of action.

Option #1: Sell the home. This is the most commonly chosen option in the course of a divorce. Generally speaking, there are a lot of memories in the marital home and some people just want to start fresh in a new place. Sometimes it’s just an economic reality, since you’ll now be supporting two homes on whatever the prior joint family income used to be. The process can be as arduous or as peaceful as both parties choose to make it. Sometimes you are able to agree on a Realtor and other times parties choose stipulate to have two Realtors represent each party separately and co-list the home.

If you can’t agree on a Realtor the most common solution if for one person to submit three names to the other. The other person chooses one of the three, or else in response submits three names back to the first person. This process continues until a Realtor is finally selected. Or, again, you can each have your own if you will find Realtors willing to split the commission.

If you do choose to sell your home, it is important to keep track of any and all repairs that need to be made so the cost of these can be deducted “off the top” of the community funds from the sale of the house. You need to be sure to mutually agree to these repairs, and one party cannot unilaterally choose to make repairs without the other’s consent in most cases.

Depending on how contentious your divorce matter is, both attorneys (along with their clients) may agree to a partial distribution from the sale of the home to the owners, while maintaining another portion of the sale in their respective attorney’s client Trust account. This leaves a little money set aside to equalize any other financial issues that may be pending with the court (ie., attorneys fees, support or a settlement offers).

Option #2: Re-financing the home into one of the spouse’s names. This is the second most common option. Sometimes (especially if minor children are involved), parents wish to maintain some consistency — such as keeping the child in the same school district and also staying in their childhood home. If this decision is right for you, one person would need to qualify for the loan to take over the mortgage of the home and to “buy out” the other party’s one-half community interest. Your attorney will likely want to put the agreement in a written stipulation so neither person can claim they only agreed to sell the home under duress. Your attorney should also make sure title of the property is appropriately changed, and not just address the mortgage – a common mistake that unrepresented parties make.

Option #3: Continue to co-own the home, at least for a specified period of time. There are certainly some circumstances where families wish to continue to own the home and use it as a rental property OR co-own the home, but allow one party to remain in the home and make payments. Although this is the least likely scenario (and depending on your situation, some attorney’s may advise against it) it does sometimes happen! But make no mistake – you’re basically entering into a business partnership with someone you’re choosing to divorce. This type of situation would be most likely to happen in a mediated divorce (or a “silver-era” divorce/mediation) situation.

The above are a few different options that may best suit your individual situation. It is important to convey to your attorney which option you prefer and why. Depending on your circumstances, your attorney will advise you accordingly. No option is “off limits.” But there are some situations that may potentially put in you in a sticky situation in the future, and you need to give these close consideration. Keep in mind that your attorney has your best interest at heart!