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Options in selling your house during a divorce in Michigan

On Behalf of | Jul 27, 2022 | Divorce

When a couple divorces, they usually aren’t able to keep the home because it would be too expensive for either spouse. If one spouse is able to afford to stay in the home, this could be negotiated in the divorce settlement.

Delayed sale

You don’t need to immediately sell your house after a divorce. You and your spouse could come to an agreement that you will wait a certain amount of time before selling the home. This option is usually for those who have children. Allowing your kids to finish growing up in the house could reduce their stress over your divorce.

Buy out your spouse

If you want to keep the home, you have the option of buying out your spouse. You would estimate the value of the home and what percentage would go to them during the divorce. Before you begin negotiating what to do with the home, you should first create a list of all of your assets and debts. It’s best to hire a forensic accountant to do this for you because they could come up with the most accurate estimate. They also have the skills to locate hidden assets.

You should have enough income to qualify for owning the home as well. When you divorce, you need to refinance the home in your own name to keep the house. Lenders will usually require that you qualify on your own income.

Sell immediately

If neither of you want the house, you could sell it immediately and split the profit. Ideally, you may want to sell the house before the court finalizes your divorce to take advantage of tax deductions. Married couples don’t have to pay capital gains tax on the first $500,000 of profit. Singles, however, have a lower exemption of $250,000.

How you go about selling your house during a divorce depends on your finances, personal preferences and your spouse’s wants. With the help of a trained mediator, you could speed up the process of coming to a reasonable decision.