Buying a home is often considered a milestone for many married couples. However, if you decide to get divorced, determining what happens to the home can be one of the greatest challenges of your divorce. In Michigan and other equitable distribution states, a home owned by both spouses is considered marital property, making it a part of the property division divorce process.
Your home will be handled as specified by your prenuptial or postnuptial agreement if you have one. If you do not have such an agreement in place, you have a few possible options when dealing with your marital home.
Sell your home and split the proceeds equally.
This is generally the simplest and least expensive option for most couples, as both spouses will likely walk away feeling like they got a fair deal. The parties will need to find a realtor to handle the sale and agree on how to split home maintenance costs until it is sold. The amount the home sells for will be based on the housing market at the time of the sale, and each spouse will get 50 percent of that amount.
Put the title in one spouse’s name and refinance.
One spouse can buy out the other spouse by transferring their interest in the property to the other spouse in exchange for payment. The other spouse will then have complete control of the home and will have to refinance the mortgage solely in their name. However, the spouse that decides to keep the home should make sure they can afford to do so without the support of the other spouse.
Continue living together in the home.
Some divorcing couples, particularly those with children, may find it beneficial to continue living in the home together. You and your ex can maintain separation by designating certain areas for you and other areas for them.
If you have children but do not want to live in the home at the same time, you should consider nesting. Nesting allows the children to remain in the home all the time, while you and your ex spend alternate weeks in the home.
Joint homeowners who are divorcing may have a difficult time deciding what to do with the home, but there are several ways to handle this issue.