Keeping the House

Should I keep my house in the divorce?
As you can imagine, the answer to this question is pretty complicated. As you make this crucial decision,  there are several factors to consider in both the practical and the emotional realms:
  • How much Is it worth? It’s often the largest asset in a marriage and your ex will need to be paid off for their share of the equity whether it’s by cash, retirement funds or some other asset.
  • What are you giving up by keeping the house? Will you have any cash or retirement funds left after you buy out your ex’s portion? What might you do with the cash if you had that instead of the house?
  • Can you qualify for the mortgage? If there’s a mortgage on the property you will be required to refinance it to release your ex from the mortgage. The question is, will a  bank approve you for a mortgage based on your income alone, your equity and your credit score? In today’s gig economy, it is more difficult for independent contractors to qualify for mortgages based upon income, because banks also prefer a documented, steady employment history. So make sure you will be able to qualify on your own before asking to stay in the home.
  • Can you afford the ongoing maintenance of the house on your own after the divorce? It’s important to calculate all the expenses you will incur each month and figure that into your budget. 
  • If you don’t keep the house, where are you going to live? Compare the financial impact of your alternatives to get a better idea of the ramifications of your decision over the long term.
Housing issues have significant financial and emotional impacts,  so consider your options from both perspectives. Depending upon your personal values, there may be an emotional rationale that is more important than the financial outcome, so trust yourself to make the best decision for you.