Selling a Home During Divorce – 3 Things to Consider
Deciding to sell the family home in a divorce can be an emotional decision. Consider these three things to make the best decision.
The decision to potentially sell your family home can come with many emotions. For some people, this decision is hard because of the countless memories that are made in a family home. Children, birthdays, smells, favorite meals…so many memories. For others, thinking about selling the home is hard because of the stability the home provided. For others, deciding to sell the marital home can be easier, there may be a lot of negative memories associated with the home, and starting new feels like a relief.
And still for others….
Some parents make the assumption that “kids benefit most from staying in the family home”. (Watch our course Parenting from Two Homes to hear more about why this is not always true for kids) No matter what the reason is, a family home drums up a lot of emotions.
Prior to stepping into this decision, assess where you are in your feelings, emotions, and logic. Most decisions are rooted in a combination of emotions and logic and it’s important to recognize and identify how much of our thought process is made up of logic and how much of our thoughts and reactions are made up of emotions. There is no right or wrong with the mix of emotion and logic, it is more about being aware. When it comes to decision time, you have a better understanding of how rooted you are in the emotions and what portion of your mind is working within logic. Where do you find yourself on the spectrum below when it comes to logic and emotion?
Navigating whether to sell the family home in a divorce can be an emotional decision. Consider these three things to make the best decision.
The FIRST question to explore when considering the sale of your home in a divorce is…
Do you want the family home? When you think about this question it is important to spend some time reflecting upon your interests and goals and how THIS house plays into that vision. If your gut and your heart are telling you that you want to keep the family home then it’s important to dive into the why behind the importance of keeping the home.
Ask yourself questions like;
- Why is it important to me that I keep THIS home?
- How important is this home to the children?
- Is this something that the kids have shared with me or is this an assumption I am making?
- What goals does THIS home help me to accomplish?
Once you have sat down to think through these questions, what sticks out to you about some of your reflections and thoughts? Sometimes it becomes really apparent that you are very emotionally connected to the home but beyond the memories, there is not a lot of logic to keeping the home. Or, It may become apparent there are a multitude of reasons that keeping your home feels like the best option, both emotionally and logically.
The SECOND question to explore when considering the sale of your home in a divorce is…
Can you afford it? This question is not as cut and dry as one may hope. There are a lot of factors that play into this question but the sooner you can start exploring options and flexibility the more efficient the overall process will be. A few key things to consider when exploring if you can afford the home:
- How much do you still owe on the home?
- How is the property currently titled?
- What is the current monthly payment?
- What is your current income?
- How much is your current monthly budget?
It’s important to know that these questions will not give you a firm answer if you can FOR CERTAIN afford to keep the home but this is the beginning of the exploration of the possibility.
A few caution flags when keeping the home may not be in your best interest and you may want to explore other options are if the following are true; (*These questions are not all-inclusive and every scenario is different and you may want to reach out to a local professional to review your situation).
- Is your family home the main/only asset you and your spouse own?
- If the current mortgage is higher than your monthly income?
- Do you have substantial debt that would limit your ability to get a loan in your name?
The THIRD question to ask yourself if you are considering selling your home in a divorce is…
How will it affect your long-term goals? When it comes to divorce and thinking through any decisions, it’s important to think of the here and now, and not to overlook how these decisions may play out in the future.
Your future can look different in many ways but thinking about a range, visualizing a worst-case scenario, and considering the best-case scenario. The home is oftentimes one of, if not the largest, asset that a couple owns. When you think about your long-term goals, think about how you envision your future. When you see your future, where are you living? What is your income potential for the future?
Always Remember when it comes to selling your home in a divorce…
You ALWAYS want to avoid being house rich and cash poor. If keeping the house puts you in a position to not be able to save towards other long-term goals, like retirement, kid’s education or other long-term dreams you have then it’s important to think through priorities. Use a helpful tool called reality testing and ask yourself the following question and try it on for size…
Do a bit of reality testing…
“You were able to keep the house, but with keeping the house the property settlement resulted in a very low amount for retirement accounts. It sets you back at least 10 years for your retirement goal.” How does that scenario sit with you?
Now take it a step further…
In the scenario above rank in order of importance to you either keeping the family home or being able to retire on the same timeline that you planned on pre-divorce. Quantifying and reality testing these priorities will likely give you a better idea and clear picture of your needs and focus. It’s important to remind yourself there is no right or wrong answer but ask yourself what scenario feels better or “which option can you live with”?
If this feels like a really hard task to think about complete on your own, then take a look at the Parenting From Two Homes Course, we have one section where we spend time envisioning the future. We also help you walk through top areas of financial stress and divorce and help you identify who the best professional is to help to ensure you are most efficient with your time and money. Divorce can be really expensive if you are not intentional. Divorce and co-parenting are vulnerable places and when you don’t feel like your ground is stable, you can waiver in decisions – and when you waiver it costs a lot of money. Do yourself a favor by working through some of these big decisions with support – a great first step would be our Online Course.
