One of the biggest tasks you face when separating or divorcing is the equalization of your assets. For most people, the matrimonial home is the largest asset they share with their spouse or partner. To most people, the realization that they must sell their home is daunting and overwhelming, and trying to split this asset may cause even more uncertainty and confusion.
Luckily, there are some steps that you can take that will make the process as seemingly smooth as possible.
What will happen to the home?
Firstly, you and your spouse/partner must decide on what will happen to the home. Do you sell it and split the proceeds? Does one party remain in the house while the other party buys the other party out? Who would stay and who would go? Does the party who is going to stay qualify for financing on their own?
Will the party be able to carry the other expenses of the home such as property taxes and utilities? If one party decides to buy out the other or have their share of the home transferred to the other party, you will need to retain a real estate lawyer to handle the transfer. Will the legal fees be shared, or will one party pay for these expenses?
If you cannot decide what to do or cannot agree on what to do, enlisting the assistance of an accredited mediator who is experienced in family law can greatly help you reach a resolution.
When should we sell our home?
Selling a home may take many months, depending on real estate market fluctuations. You may also need time to bring the home into a good state of repair which may add time to getting the home sold.
If the parties cannot agree on a realtor, a mediator can assist you with this process. The parties should advise the realtor that they are selling due to a separation/divorce, and they should ideally choose a neutral realtor, that neither party has had any previous association with. Steer clear of family or friends who are realtors. Your mediator or lawyer may be able to recommend a few realtors for you both to meet with.
The home would be appraised and sold at fair market value by a qualified realtor that you both agree on, all expenses should be paid out of the equity of the home equally between the parties, and the funds remaining would be split between the parties. A real estate lawyer can assist you with this process.
Sometimes, it may be necessary for your real estate lawyer to hold the proceeds of the sale of your home in trust, until all other matters have been agreed upon through mediation or through a court process, at which time each party would be paid out their respective share.
What price should we list the home at?
This part is often the point of disagreement between the parties themselves or the parties and the realtor. It is not always easy to agree on this point.
Keep in mind that the home cannot be listed for sale until both parties have agreed on a list price. If you cannot agree on a list price, your mediator can assist you by reviewing various home appraisals with you and facilitating a resolution on the list price. It is a good idea to listen to your realtor, who is experienced in real estate, and can guide you depending on the housing market at that time.
Various realtors have different strategies for selling homes, and you would do best by taking what your realtor is advising seriously. Most realtors will show you comparable properties to help you decide on an effective list price. Overpricing your home may delay a sale or cause the property not to sell at all. Listen to your realtor, they know best in this case.
How much should we spend on home repairs? And who should pay?
Most homes need some work, even if minimal to get the home ‘sale-ready’. Does the home need a new roof? Does it need a new paint job? Does it need a good clean out to de-clutter the home? How much are you willing to put into the home to get it ‘sale-ready? Again, your realtor will guide you through this process and advise what work needs or should be done prior to listing the home for sale.
Your realtor may advise you to stage the home, which comes at a cost. There are many things to consider. What is your budget to get the come ‘sale-ready’? If you are short on funds, then it would be advisable to only get the more pressing issues renovated or fixed. You should keep all your receipts of what was spent by each party. This will become useful if you end up going to mediation or court to settle the remaining issues.
What do we do now that we have an offer on our home?
If an offer or multiple offers are presented to both parties, you have to agree on whether to counter the offer, decline the offer or accept the offer. You both need to agree otherwise the offer cannot be accepted. Many things would need to be considered at this point, the closing date, the purchase price, any conditions, etc. All the clauses of the offer must be agreed upon by all parties. Your realtor can help you navigate the offer and what each clause of the offer means.
Once you agree on the sale, the realtor will take over and continue the process, until it is time to involve your respective real estate lawyers. You should each get your own real estate lawyers to avoid a conflict.
Once your home is sold, you both can move on with your new lives. This is normally a very large part of the divorce process and offers a ton of relief once the home is sold.
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