Consider All The Repercussions Of Keeping The House
A home is usually one of the largest, shared assets in a marriage. For many, a house is much more than a property. It is the place where you built memories, raised your family and the product of your hard work and sacrifice. Deciding whether you want to keep your home during a divorce is a difficult decision.
Determining If You Can Afford Your Home
First, you should evaluate whether you can afford to pay the mortgage on your own. If you do not already have a monthly bill tracking sheet, create one. Your bill tracking should include expenses like your mortgage payment, gas bill, internet, groceries and car payments. Most experts recommend that you should not spend more than 28 percent of your income on your mortgage.
You will also want to decide whether you have the time and money to manage the upkeep of your home. If you have a yard, that means mowing the lawn, clearing the snow and paying to have the roof replaced, if it leaks.
You also have to decide if you can refinance to buy your spouse out of the home. This may depend on the monthly mortgage cost for your new loan versus renting and saving any home equity to buy something later.
Staying In Your Home May Or May Not Make Long-Term Financial Sense
More than deciding whether you can afford the mortgage and upkeep, you should evaluate whether it makes long-term financial sense to keep your home. To remove your former partner’s name from the mortgage, you will need to refinance your home. This is like closing on your house again, so there will be significant costs associated with this process.
If you are not planning to stay in your home for a long time, it may not make sense to refinance it, as you may not gain enough in equity to cover the refinance costs. However, if you plan to stay for several years, your house may continue to appreciate, and you could recover the refinance costs and then some.
You may also have to live together in the home until the home is sold if neither your spouse nor you can afford the mortgage, homeowner’s insurance, taxes and maintenance on your own. It’s an issue that, in today’s economy and low equity in homes, is a big issue for middle class Americans.
It is likely you may already have equity in your home. If you do, you will have to buy your former partner out of home, since this equity is likely a shared marital asset. This is another expense you will have to factor in the expense of keeping your home.
Owning Your Home Allows You To Maintain Your Independence
Keeping the family home is important to many people. It may mean keeping your independence or holding onto memories.
If you decide to stay and refinance your home, I will fill out all paperwork and file it with the proper authority. As your lawyer, I can also help you negotiate a fair settlement with your former partner. At Thomas M. Gurewitz, Attorney At Law, I am committed to helping you move on to the next step in your life, whatever that may be. I have worked more than 40 years as a family law attorney, and have helped many Waukegan residents stay in their homes after a divorce.