DIVORCE AND SELLING YOUR HOME
The family home is usually a couple’s largest asset and because of all of the memories and emotions involved,
it can be hard to let go.
Having the right Realtor is essential in this situation. When you’re in the middle of a divorce, an experienced real estate agent can make all the difference in the world when it comes to alleviating stress and helping you navigate the unique financial concerns and detailed steps involved.
When you and your spouse decide to sell your home,
you must discuss and agree on the following issues before you proceed:
ACTION ITEM LIST:
1. Make a list of all major repairs needed in the home.
2. If you have a mortgage, get your loan balance and loan account number.
3. Decide if you will sell as-is or if you will make the needed repairs
4. Get an appraisal If the two of you can not agree on a listing price.
5. Overpricing a home is the biggest mistake that sellers make and will end up costing you more money.
Listen to your agent’s advice on setting the price to help eliminate a potential conflict.
Preparing your house for sale can be the most difficult part of the sale process. Usually there is some some work that must be done—painting, clearing out clutter, minor repairs etc —before the house is ready. Again, you need to agree on who will cover these costs. If the house is vacant when you put it on the market, you can leave it as is - to be staged by the agent. If one of you is still in the home, this work will fall mostly on one person so you might need to discuss compensation for the person that put in this extra effort.
DIVIDING THE MONEY
California is a community property state.
In California, any property acquired during the marriage is owned by both spouses, with and exception for inherited property. In the majority of cases (but not all of them) a house bought during the marriage using both spouses funds will generally be divided equally.
Finally, you’ll have to figure out how to divide the proceeds. This shouldn’t be too complex. Your escrow company will distribute the money, after paying off all the obligations on the house and making whatever other payments and debts you’ve agreed to.
Please note that separate property contributions to community property are also reimbursable and will need to be addressed prior to accepting an offer if either spouse is requesting such reimbursement. For example, if one spouse has continued making mortgage payments, that spouse has been reducing the principle and increasing equity, which could increase the amount to be divided. The distribution will need to be adjusted to account for that spouse’s contribution.
CAPITAL GAINS TAX
If you sell the family home during or after a divorce, you probably won't have to pay capital gains tax. There are some exceptions.
Pleas visit this link for more information.
The easiest way to deal with sale of a home during a divorce is to hire a Realtor right away. I'm saying this because THIS WILL SIMPLIFY YOUR LIFE. This is not the time to try to sell on your own or gamble with inexperienced agents. There are too many moving parts with a divorce and you need someone with experience who can act as an impartial advocate for both parties take a lot of the worries off of your plate.
I can tell you that I have many clients that have been exactly where you are now, and my team and I will help you navigate this delicate time with kindness, efficiency and attention to detail - while getting you the absolute highest price possible.
Contact me today and I will help you in any way possible, and answer any questions that you have, big or small.
While the idea of selling your home can be difficult to accept, the advantages are that both spouses get money to start over, and it may help you make a clean break. And, many people would prefer to have the money from sale than to keep an asset that reminds them of a happier time that has now passed.