As you work through the complex emotions that come with divorce, more practical matters may fall to the back of your mind. The reality is that all assets and debts require division during divorce, and it is often difficult to determine the best way to handle more complicated debts like a mortgage.
If you own a home with your current or ex-partner, you have options when it comes to your mortgage. If there are children involved, you may want to keep the home, or it may be best for you if you sell it. Experian gives three things you can do with your home during your divorce.
1. Sell the house
Many divorcing couples choose to sell their homes, but if the market is bad or you are upside down on your mortgage, this may not be the best choice. If you do choose to sell the home, both partners split the proceeds if they are both listed on the mortgage. If you sell the home, you both get a clean break, enjoy the potential tax benefits and get a fresh new start.
2. Buy out your partner
If you want to stay in the home but you are both on the mortgage, one party can buy the other out by paying them their equity in the home. In these cases, there is minimal disruption to children, and you avoid any moving or selling costs.
3. Co-own the house
If both parties can manage it, you may choose to co-own the house. This is a good choice if the housing market is unappealing, one spouse needs to rebuild credit or parents want to keep the stability for their kids.
Every situation is unique, and it is often easier to decide what to do with the house in amicable divorces.