Getting a divorce and selling a home are probably two of life’s most stressful life events. Doing both at the same time can be doubly difficult. Yet, for many couples, a divorce necessitates selling the family home in order to divide their financial assets.
During such an emotional time it’s important to have the help of a professional real estate agent who can guide you through the sale with as little stress as possible. Below are some of the steps of the process, along with questions and tips for getting through it all:
Deciding to Sell
Since a home is often a couple’s largest asset, deciding to sell needs to be a clear-headed, logical decision, leaving emotions aside. A few questions to ask:
- Can one person financially afford to buy the other spouse out and maintain the home on his or her own, or are they forced to sell in order to physically separate?
- If children are involved, how will the sale of the home impact them? For example, will they need to change schools?
- Is it a good time in the real estate market to sell?
Selecting a Real Estate Agent
The choice of a real estate agent is always important, but never more so than when the sellers are going through a divorce. Not only does the agent need to be knowledgeable about the market and a good salesperson, but he must also be patient, empathetic and excellent with communications. Sellers may prefer to have the agent communicate with them as a couple, or separately, according to their own preferences of method and frequency.
Sometimes divorcing couples have difficulty agreeing on much of anything—real estate agents included. In these cases, it might be helpful for each party to select one trusted friend or relative, and allow those two people to agree on the selection of an agent.
Making Decisions Related to the Sale of the Home
There are many decisions that go into the sales process, including:
- Sales price—Generally it’s best to go with your agent’s recommendation. It’s his business to know the current market and advise you according to your goals and timeline.
- Timeframe—This is a decision that needs to be made together, taking into account the overall financial situation, as well as each person’s individual finances and school and work schedules. You must also decide whether one or both spouses will remain in the home during the marketing period and where you each will go after the sale. If one or both partners will be purchasing a new home, this must be figured into the equation. A trusted agent will be able to provide advice that will help you determine a reasonable timeline.
- Preparation—How much will be spent and what will be done to prepare the home for sale? How will these costs be paid for? Again, it’s probably best to go with the agent’s recommendations, as long as they seem reasonable and are within your budget.
And finally…
After the Sale: Paperwork and Division of Proceeds
The way that the proceeds of the sale will be divided should be decided before the home is put up for sale. Once that’s determined and the sale has closed, the escrow company can pay off the obligations on the home—and whatever other payments you’ve agreed to—and then distribute the money. If the title to the property is in both names, arrangements can be made to have the sellers sign the required documents at separate times and locations. If the title is in one name, only that individual needs to sign the paperwork.
Be sure to check with your tax advisor about capital gains laws and exemptions, which can be affected by divorce, so that you understand capital gains exclusions that are valid for your situation.
Divorce is never easy and the necessity of selling a family home can make it even more trying. If I can be of help, please call me for a consultation to determine what your home is worth and how I can make the process as easy for you as possible.
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