After making the decision of ending your marriage with your soon-to-be ex-spouse, you have to brace yourself for even tougher decisions during the course of your divorce.
For starters, you need to decide as early as now what you intend to do with the family home, which is perhaps your family’s single biggest asset. Will you keep it or put it on the market?
The answers to these questions will depend on factors such as who owns the house, whether you have children or not, you and your spouse’s personalities, and the nature of your divorce (i.e. amicable or not).
While you weigh these factors, here are a few suggestions on what you can do with the family home.
Option 1: Sell The Home, But Only In The Near Future
This is an ideal option if you and your spouse can agree to dispose of the family home until the kids are older or have moved out of the house. Many divorcing couples pre-agree to split the equity of the home upon selling it, having one spouse stay in the home in the meantime to avoid disrupting the kids’ lives.
This arrangement can come with serious setbacks, however. Many parents, particularly women, negotiate for the home instead of cash, and so they find themselves with a home to live in but no cash to support their lifestyle after the alimony and child support run out.
It’s also a good idea to hold off from making any decisions about your home during and even after the divorce. Once you’ve gotten used to life after marriage, you may be in a better position to make decisions about the fate of your home.
Option 2: Sell Right Away
There are often also situations when it’s financially smarter to just sell the house right away and split the profits with your partner. This is a good move when you consider the closing costs of selling a home, from commissions for your listing agent and home inspection fees to repairs and improvements before selling.
If you’re cash poor, it may be better to just sell the house right away, split the profits, and divide the costs of selling.
Option 3: Consider Nesting
Nesting is a setup that may work for you, especially if you and your soon-to-be ex are on good terms.
Nesting involves keeping the family home and having the kids stay put while the parents take turns living there. The parents can agree to rent and split the costs of a nearby apartment or home, taking turns living there too.
It’s a progressive and downright crazy idea, but one that somehow works for some families. The time will eventually come when it’s more sustainable for one person to buy the other person out of equity or sell the home and split the cash, however, so don’t expect for any nesting setup to last.