The family home may be the most valuable asset owned by a married couple. Once a divorce is pending, the fate of that home will impact both parties and also impact the finances of both. Texas residents should be aware of the options for the family home and how those options may impact finances going forward.
The property division process can depend heavily on the value of the house involved. One party, particularly one who wants to be bought out or wants to sell the home, may want a higher value assigned to the home. The person who wants to keep the home and is faced with financing on his or her own to buy out the other party may wish for a lesser value when a home is appraised. Some recommend that three appraisals be arranged to ensure a fair and accurate assessment of the home’s worth.
The party who does not want the home will obviously have to find a new place to live. Regardless of whether that person plans to buy or rent, a credit score will play a role. It is important for that party to have his or her name off the mortgage before seeking a new home because a shared mortgage can mean a shared credit history. For example, if both names are on the mortgage and the person keeping the home does not pay the mortgage, the other person’s credit score can suffer, making renting or buying a new place difficult or even impossible.
Before resolving divorce issues about the marital home in a property division settlement in Texas, each person on the mortgage should understand the options for keeping or letting go of the home. The finances going forward will affect the quality of life of each person. Understandably, the sale or purchase of a home that was once shared will play a dramatic role in those finances.
Source: hmbreview.com, “Consider how divorce can affect home situation”, Steven Hyman, May 22, 2016