What You Need To Know About Co-Owning Your Home with Your Ex-Spouse after a Divorce
Going through a divorce is an involving experience with many activities that make it necessary for you to think about the arrangements you should make financially as well as for your children (if you have any). One of the most significant components during the divorce will be the division of assets. Since the house could be the single largest asset of your marriage, it can be a linchpin of negotiations for property settlement, and deciding what to do with it will often help put other issues of property into perspective, both emotionally and financially. If you decide to co-own the house, here are a few things to keep in mind:
Is That What You Really Want?
If you buy a house when married, you become joint owners. Even after a divorce, you will still be the joint owners of the house unless the court orders otherwise. If in your settlement you agree to co-own the house, perhaps until your kids are of a certain age, you will have to decide on the homeownership expenses like mortgage payments as well as any occupancy each one of you will enjoy. This doesn't mean that both of you will have to live in the house, so if you are the one staying, make sure that you can live in it comfortably. Don't negotiate so hard for the house only to realize later that it harbours a lot of atrocious memories that you can't even stand staying in it anymore, forcing you to end up selling it. Therefore, take some time, sit quietly in every room, and decide whether it is a place you'd really want to live for the next few years.
How Is It Beneficial?
If you have kids and you are the custodial parent after the divorce but can't afford buying out the house from your ex-spouse, the greatest advantage is that the kids will get to stay in the home. This is important because it will provide them a significant sense of continuity and security.
What Are Some of The Risks of The Co-Ownership?
One significant issue about this is the mortgage. While you marriage may have ended, the mortgage will remain a responsibility. Therefore, if you're staying, do yourself a favour by developing a comprehensive budget and being mindful of the capital gains tax so that you don't lock yourself in a divorce settlement that you can't live within. If you're the one leaving, you need to understand how this decision will affect your credit. Even if your ex-spouse pays the mortgage promptly, you still owe some significant amount on the house, and this can make it challenging to borrow to buy another house. Therefore, ensure that you're comfortable with the decision.
Other unfortunate risks are cases of death, filing for bankruptcy, or being sued by creditors. In the case of death, the mortgage share would have stopped. Either of the two other cases could result in shares being seized up or even a forced sale. Contact a local family lawyer, such as one from Marino Law, for further assistance.