Most couples invest a lot of their marital income into the maintenance of their home and mortgage payments. The longer you have stayed married, the more you and your spouse will have likely paid into the home where you live.
When you decide to file for divorce, you will obviously want to protect your interest in your home. What happens to your house when you divorce?
Do you have an agreement with your spouse?
If you signed a prenuptial agreement or drafted a postnuptial agreement, you may have already discussed how you want to handle your house during a divorce. That document will likely guide property division and other steps in your divorce. If you don’t have an agreement, what happens then?
Will you have to share the equity in your home?
One of the biggest determining factors in what happens with your house in a divorce is whether it is marital property or separate property.
If you have invested in the home using income earned during the marriage or bought the house jointly with your spouse, then the chances are good that much of the equity is marital property that you have to share. If you inherited the house or owned it before your marriage, it may be separate property that the courts will not divide.
What do you do with the actual house?
There are multiple different ways to handle the home itself if you have to share it with your spouse. One of you could stay in the house and refinance it, paying the other an appropriate amount of equity. You might agree to sell the house and split the proceeds. Some spouses even decide to remain co-owners of the house if they want to rent it out to others or try bird-nesting because they share children.
Thinking about your priorities after your divorce can help you strategize how to handle your house and other major property division concerns.