As part of a divorce settlement in New York, spouses must divide their assets and property equally and fairly, including the family home. While a judge can award the marital home to one spouse, couples can also reach their own agreement dividing up community property (or marital assets).
The following are several options for what to do with the family home during divorce:
Dividing large assets – If you and your spouse have multiple assets, such as another real estate property or a large investment portfolio, one spouse may keep the marital home while the other takes ownership of assets roughly worth the same amount. Although you do not have to wait until someone purchases the home, you and your spouse must still negotiate the value of all assets to ensure equitable distribution.
Buying out your spouse – If you wish to gain sole ownership of your home, you could offer your spouse a buyout by paying half of the current market value of the house. However, you need to have access to funds that are not subject to property division, unless you are able to afford the home after refinancing. You must also be able to afford mortgage payments based on your own income.
Co-owning the home – If you cannot afford to buy out the other spouse or if you want your children to remain in the family home, you and your spouse may agree to keep owning the house together. Yet, you must determine how each spouse will pay the mortgage, when will the property be eventually sold, and how the proceeds from the sale will be divided among both parties. The spouse who won’t be living in the family home must be aware of capital gains tax exclusions.
Selling the home – Lastly, you and your spouse may sell the home and split the proceeds, which could be used to settle debts, find a new place to live, and cover legal costs associated with your divorce. If you and your spouse lived in the residence for two of the past five years, you can avoid paying capital gains taxes.
If you are interested in filing for a divorce in the Bronx, contact The Franklin Law Firm today at (347) 378-1170 to let us protect your rights and best interests throughout the entire process. Schedule a free case evaluation immediately!