Selling your home due to a divorce
Divorce is a tough situation that brings up many emotional and financial issues to be solved, especially when it comes to deciding what to do with the family home. As a homeowner in Ottawa, Ontario, it's important to understand how divorce affects your home, mortgage, and taxes. Getting neutral, third-party information can help you make logical, rather than emotional decisions.
Here are four options you have when it comes to your house during a divorce:
Sell the house now and divide up the proceeds. Your primary consideration under these circumstances is to maximize your home's selling price. It's important to work with a professional who can help you avoid the common mistakes most homeowners make which compromise this outcome.
Buy out your spouse. If you intend to keep the house yourself, you'll have to determine how you'll continue to meet your monthly financial obligations if you now only have one salary.
Have your spouse buy you out. If you're the one leaving, you have the opportunity to start again in new surroundings with cash in your pocket. However, be aware that if the old home loan is not refinanced, most lenders will consider both you and your spouse as original co-signers to be liable for the mortgage.
Retain joint ownership. Some divorcing couples postpone a financial decision with respect to the home and retain joint ownership for a period of time even though only one spouse lives there.
It's important to work together through a professional to maximize your return when you decide to sell. You both should be present when a listing contract is put together and both should be active in the ultimate negotiations.
It's also important to consider who is on title. If both of you are, then you both must agree on who to sell the house with, what price to list it at, and when your preferred closing date would be. If you both can't agree, you can have your lawyers speak for you to the realtor.
Even if you're not both on title, the spouse that is not must agree to the terms of the sale and sign the listing agreement. When the offer comes in, both the owner on title and the non-owning spouse must agree that the offer is satisfactory and sign the final agreement of purchase and sale.
Remember, making things easy or difficult is in your hand. If something can be achieved the easy way, why make it difficult? In the end, it's important to understand the financial implications of each scenario and make informed decisions that will be right for your situation. If you need help with selling your home due to divorce, don't hesitate to contact us and tell us a bit about your situation.