Who gets the house in a divorce? Its not a great question to ask and not a great one to answer.
No one plans to separate or divorce, but unfortunately, sometimes it happens, and not only do you have to deal with the emotional hurt but the financial implications too. Knowing what to do with your family home can be a difficult decision, especially seeing, as it is most likely your biggest financial asset. So lets begin to take a look at who gets the house in a divorce?
What to consider first
The first thing you need to work out is how much you are going to be able to put towards housing. This will help you decide whether you would be able to afford to stay in your home and pay the mortgage alone, or if it would be better financially to sell, rent another house or buy a new home.
A very important part of this decision will be if you have small children to consider. Many divorcing couples decide that one of them will stay in the family home for the time being to try to make the transition easier for their children. Courts in England and Wales can defer the sale of your home until something specific triggers the sale, for example if you decide to wait until your children leave school or when the youngest child turns 18. The court will take the safety of your children into account, so whatever you decide you need to make sure that they have somewhere suitable to stay with both parents.
Valuing your home
Whatever option you decide on, your home will need to be valued for the divorce settlement. You could ask an estate agent what the house would sell for, many agents like Zevizo Properties offer a free valuation and this will give you a guide price. If you both cannot agree on a value then the court will most likely order a report from a local estate agent or surveyor anyway to work out how to divide the property.
If you own your home outright and do not have a mortgage to pay off, then most people decide to sell and split the money 50/50. However, if you cannot agree on how to split the house and leave it to decide in court, be aware that the law in England and Wales does not automatically decide on dividing the home in this way. Instead, your circumstances, such as any children, your income, financial needs, responsibilities, age, disabilities and more used to decide where to allocate the assets.
If you have a mortgage, the next thing to do is to find out how much you still owe. If you decided to sell your house, after paying off any fees, how much money would be remaining? This will help you work out if it would be possible for each of you to buy a new home out of what is left or if the best option would be to rent.
What if there is a joint mortgage?
If you have a joint mortgage on your home, there are a few things to think about. When you take out a mortgage together, you are both still responsible for the payments for the whole duration, not just when you are living in the house. Not paying on time can damage both of your credit histories and could make it difficult for you to get credit or another mortgage in the future.
As soon as you decide to divorce, it may be a good idea to contact your bank. Many banks are sympathetic when couples are going through a divorce and can offer you a payment holiday to help with the financial difficulty until you decide what to do, but you will still need to come up with a long-term plan.
The first option is if you are able to sell and pay off the mortgage. This will be the easiest way to give you a clean break and any equity from after the sale divided between the two of you. The difficulty may be if you find that unfortunately you are in negative equity, when the value of your home is less than the amount you owe on the mortgage. In this case, it may be impossible to sell and split any proceeds, and it would be best to consider one of you staying in the property and the other renting, or if the divorce is on friendly terms, living together in the short term. If this is the case, it is best to speak to a mortgage advisor on your options or seek independent legal advice.
The second option is if one of you decides to stay in your home. To do this, you will need to be able to prove that you can afford the mortgage payments on your own, and then you will need to transfer the mortgage into one name. This means that whoever decides to stay will need to buy out the others share, including any equity involved, and if you need to borrow money to do so, you will have to prove that you can afford the extra borrowing.
Thirdly, in some circumstances, such as if you do not have long left on your mortgage, and the separation is on good terms you may decide to both continue paying the existing mortgage. If you do consider this option, make sure that you can both afford to keep up the repayments on top of any other living costs. This might also be something to consider if you have a fixed mortgage for a number of years and moving would mean you paying high charges to do so.
What if my name is not on the house deed?
When it comes to divorce in the UK, your matrimonial home is a joint assent and neither partner can force the other to leave, even if only one person’s name is on the house deed. There are ways to make stop your partner selling without your consideration by registering your right through the Land Registry. Although, if your partner owned the house before you got married then you will have less of a claim when it comes to divorce proceedings. If this is the case for you, we advise that you seek legal advice to know exactly where you stand. Also, if you have already moved out of your home before you started discussing what to do with it, do not worry; this does not harm your entitlement to your claim on the house.
What should I do next?
The most important thing is to be realistic about what you need from your house after a divorce. The last thing you need is to be worrying about debt when you are trying to move on. If you manage; to both agree on what to do, how much each party owes or how much you will both get if there is money remaining, then it will be much easier. If unfortunately, you cannot reach an agreement or if you have any doubt about what would be best, we recommend taking legal advice, from either your divorce lawyer or a solicitor, to make sure; you make the right decision legally and financially.
We hope this article ‘Who gets the house in a divorce?’ proves to help you. For more information on selling a house or trying to get the most value from a house sale take a look at our other articles here.
This article is intended to be used as guide to help people through a tough or difficult time. It by no means replaces common sense or legal advise. Before you action anything we highly recommend you seek legal advice