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2824 Manatee Avenue East

Bradenton, Florida 3420

Office: 941.792.2111

Toll Free: 1.800.522.7869

Fax: 941.747.9632

 

 

Divorce's Costly Mistakes

DIVORCE: What You Need to Know About Your House,Your Mortgage and Taxes

How to Avoid Costly Housing Mistakes in the Midst of a Divorce
 
Divorce is a tough situation which opens up emotional and financial issues to be solved. One of the most important decisions is what to do about the house.
 
On the midst of the heavy emotional and financial turmoil, what you need most is some non-emotional, straight-forward, specific answers. Once you know how a divorce affects your home, your mortgage and taxes, critical decisions are easier. Neutral, third party information can help you make logical, rather than emotional decisions.
 
Probably the first decision is whether you want to continue living in the house. Will the familiar surroundings bring you comfort and emotional security, or unpleasant memories? Do you want to minimize change by staying where you are, or sell your home and move to a new place that offers a new start?
 
Only you can answer these questions, but there will almost certainly be some financial repercussions to your decision process. What can you afford? Can you manage the old house on your new budget? Is refinancing possible? Or is it better to sell and buy? How much house can you buy on your new budget? The purpose of this report is to help you ask the right questions so you can make informed decisions that will be right for your situation.
 
“Once you know how a divorce affects your home, mortgage and taxes critical decisions are easier.. Neutral, third party information can help you make logical, rather than emotional decisions.”
 
4 OPTIONS
 
You have 4 basic housing options when in the midst of a divorce:
 
1.        Sell the house now and divide up the proceeds.
 
2.        Buy out your spouse.
 
3.        Have your spouse buy you out.
 
4.        Retain your ownership.
 
It’s important for you to understand the financial implications of each of these scenarios.
 
1         Sell the House Now and Divide Up the Proceeds Your primary consideration under these circumstances is to maximize your home’s selling price. We can help you avoid the common mistakes most homeowners make which compromise this outcome. As you work to get your financial affairs in order, make sure you understand what your net proceeds will be –i.e after selling expenses, and after determining what your split of the proceeds will be. Note that the split may not be 50/50, but rather may depend on the divorce settlement, the source of the original down payment, and the legislative property laws in your area.
 
2         Buy Out Your Spouse - If you intend to keep the house yourself, you’ll have to determine how you’ll continue to meet your monthly obligations, if you now only have one salary. If you used two incomes to qualify for the old loan, refinancing on your own might be a challenge.
 
3         Have Your Spouse Buy You Out - If you are the one who is leaving, you have the opportunity to start again in new surroundings with cash in your pocket. However, be aware that if the old home loan is not refinanced, most lenders will consider both you and your spouse as original co-signers to be liable for the mortgage. This liability may make qualifying for a new mortgage difficult for you if you decide to purchase a home, even though you won’t have legal ownership.
 
4         Retain Joint Ownership - Some divorcing couples postpone a financial decision with respect to the home and retain joint ownership for a period of time even though only one spouse lives there. While this temporary situation means you have no immediate worries in this regard, keep your eye on tax considerations which may change from the time of your divorce to the time of the ultimate sale.
 
 
 
When You Decide to Sell
 
If you and your spouse decide to sell your home, it will be important to work together through a professional to maximize your return. Differences aside, you both should be present when a listing contract is put together. Both of you should understand and sign this contract, and both should be active in the ultimate negotiations.
 
When You Buy Your Next Home
 
Use the proceeds from your previous home or buy-out to determine an affordable price range for your next home. Maintain a clear focus on getting the right home to suit your new situation. You may wish to review with an agent who offers a house-hunting service to help find a home that matches your new home-buying criteria.





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Testimonials

My wife and I would like to take this opportunity to recognize Linda Johnston who is with the office at CENTURY 21 All Aces Realty. We had been trying to sell our house in Palmetto for approximately 2 years. Prior to being introduced to Linda, we had used two other real estate agents who were quite ineffective in getting people to look at the house. As soon as we spoke to Linda, we were impresses with her enthusiasm and determination. She immediately gave us ideas on how to list the house to attract prospective buyers. When one idea didn't work, she was innovative and determined to come up with new ideas. Her personality was refreshing and she was always professional. We felt as though we were her only client, although we knew she had others. It was a pleasure working with her and we would recommend her to any seller or buyer. Craig & Felicia Himes
My experience with CENTURY 21 All Aces Realty was remarkable, but my experience with my Agent, Matthew Rotondo was even better. Matt’s willingness to work with my wife and I was truly amazing. Matt took a true interest in our needs and wants as a young couple. Knowing we did not have the money to buy a home that needed lots of work, Matt made sure to find us a home that was move in ready. When it came time to close on our dream home, the house needed a new roof. Matt came through again, he was able to get us our dream home at price we could afford with a new roof. Matt is just a genuine good guy, I don’t know many agents that would actually come over and help you move and work in the yard. Thanks again Matt for helping my family get the house of their dreams. Richard and Lisa Glass
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