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Divorce the best way to sell a house
Selling a house after divorce or separation can be a very stressful thing people can experience.
Although the divorce rate is falling, according to one leading family law firm, 42% of marriages end in divorce.
And more often than not, a couple wants to know who gets the house in a divorce. Unfortunately, it is just not as simple as that.
Whatever the government statistics say, one thing is for sure divorce is a devastating and stressful experience for any family. When children are involved, this makes the process of selling a family property even more crucial.
Because the marital home is usually the most valuable asset jointly owned by a couple, feelings are often most substantial over your family home.
Therefore, our 2022 Guide looks at all essential considerations when selling a home after divorce.
Who keeps the house in a divorce with children?
Going through a divorce throws up different issues, and few of them are pleasant to deal with.
One crucial question people often ask is who gets the house in a divorce with children.
If it’s possible to agree on who gets the house after a divorce in an amicable manner, then all the better.
However, you may have to turn to the courts if you and your partner cannot agree on a financial settlement.
A family court can set up a “Financial Remedy Order,” which allows you to oppose your partner in court for a lump sum payment or ownership of a property.
The order can also set out terms for regular payments for childcare and living arrangements. Sometimes, the house may be in the name of one partner.
But the courts disregard this when they decide what happens to the house in a divorce.
How do the courts deal with divorce?
When they impose a Financial Remedy Order, the court will base its decision on:
- Whether there are children under 18 in the marriage, and if so, what their needs are and who they live with at the time of separation. The welfare of these children is the court’s first consideration.
- Income, potential future earnings, property, and any other financial resources each party has
- The age of each spouse
- The length of the marriage
- Any mental and physical disabilities either spouse has
- Annual earnings of each spouse. And their responsibilities during the marriage.
- The finances and assets each spouse contributed to the marriage.
Often, it may be decided that children under 18 should stay with one of the partners in the family home.
Living arrangements during separation and divorce need some careful thought. These are other areas that will throw up questions and uncertainty during a relationship breakdown.
Counselling service Relate that it is essential to take time in making these decisions, especially if you have children.
How is a house divided in a divorce?
One choice you could face is that one spouse could buy the other out and keep the property. Alternatively, the house could be sold, and then the proceeds divided.
If you have children, one parent often wants to stay, so there is as little change as possible in the family home. However, in terms of who gets to stay in the house after separation, this may be the mother.
When one spouse moves out, the other partner may receive other assets to help divide assets in the divorce.
You or your partner may agree to defer receiving the balance assets and money until the property is sold when the children move out or the partner remarries.
In legal terms, this is commonly called a “Mesher Order”, there is more on what this means below.
People assume divorce house rights are 50:50, but this is not automatically the case. This post explains how courts divide assets when selling a house during a divorce.
What is a Mesher Order?
Regarding dividing up assets in the UK, the courts will look at the couple – and family – circumstances. In general, the principle is that family assets should be divided equally.
A Mesher Order makes specific instructions clear. For example, it defers the sale of a house until a particular event, such as the youngest child turning 17 or 18. After this, the proceeds are divided by the court order.
However, the downside of this kind of order is that both you and your partner would remain on the mortgage agreement.
This makes getting a mortgage to buy somewhere new very difficult for the partner who has moved out. This article in The Guardian newspaper explains more.
As the Guardian article explains, an alternative is a more complex version known as a deferred charge Mesher. This does mean the house and mortgage are transferred into the name of the primary carer.
Meanwhile, the other spouse retains a percentage interest in the house secured by a second mortgage in their favour.
Otherwise, courts can impose a Martin Order, where the court defers the sale, and one partner can occupy the property for life or until remarriage.
A Martin Order is usually adopted where the couple does not have children. And when the other spouse does not immediately need the money to help with their own needs.
Can I sell my house before divorce?
So, when is the best time to sell a house if you are going through a divorce?
No time is ideal. But if you can reach a mutual agreement before you separate, that is best.
If you can sell your house fast, that may help you to recover from the divorce and move on.
Dragging out the sale of your marital home can create extra tension that affects other areas of your new life.
So, if you are on good terms with your spouse, try to sell your home before the divorce is finalised.
It is far better for both to move on than to procrastinate and lose a perfect buyer for the house. There are professional companies that will buy your home quickly for cash.
One sensitive area you should try to resolve is reaching an agreement on the final sale price for the house. This can be the subject of tension during a divorce.
Getting the best price will benefit you and help you get on with your separate lives.
Divorce or separation is a highly emotional time. Relationship experts Relate some advice on their website to deal with the emotional side of things.
Who can stay in the house during separation or divorce?
This is another hot topic during the difficult time of a divorce. One spouse usually moves out of the house during a divorce to reduce the tension.
However, while this is traditional, it does not mean the person who moves out loses any rights to the ownership or occupancy of the house, despite popular belief.
Both partners have ‘home rights to the marital home until the divorce is finalised. Or until a financial settlement is agreed upon.
Divorce rights to property ensure neither spouse can be forced to leave the marital home even if they don’t legally own the property or are not named on the mortgage.
If you and your partner own the house or flat, certain rights to the property after separation are protected. Provision for this has been made under the 1996 Family Law Act.
These rights include staying in your home unless a court order excludes you from being there.
It would help if you were notified of any possession action your mortgage lender takes, provided matrimonial home rights have been registered.
If you are the spouse who moved out, the court must also enable you to return to the home. The law also requires that you pay the mortgage and avoid repossession if the person named stops making the payments.
More advice on dealing with your mortgage during separation and divorce is below.
Should I consider remortgaging?
You could think about remortgaging your property as you look to sell the house after your divorce. Refinancing could allow you to access the equity in your property.
However, before you can consider refinancing, you will need to calculate the value of your property. This is so that you can be sure there is sufficient equity to allow refinancing.
This could allow you to buy out your ex-partner’s share effectively. This is an excellent option if you want to stay on the property. However, you may decide to prefer somewhere new to live to help make a clean break.
How to Divide the money and property during a divorce
You can sell your property before the divorce is finalised. Then there are options for how you and your partner divide the money and property.
Both you and your spouse could agree to sell your house and move out. The money raised would be divided according to your agreement about buying the property.
And the cash could be put towards purchasing a new home for each of you.
Alternatively, one party agrees to buy the other one out, and your home will need a valuation.
Then, if you have the funds to cover half of this, you can purchase your partner’s share. And take full ownership of the property.
Or one partner could keep the home. They could continue to live on the property, which may be convenient if your children are at school nearby.
Part of the property’s value can be transferred from one spouse to another. For example, the partner who gave up a share of their ownership rights would retain a stake in the home. And they would receive a percentage of the property’s value once it is sold.
Other options are a Mesher order or Martin order, which family courts can impose. We talk about both types of a court orders earlier in this guide.
How to Keep up mortgage payments
Although people do not think about this issue, keeping up with mortgage payments is one thing that can’t be forgotten.
In a divorce, you may be thinking more about selling your house. Banks and other home loan lenders repossess the reason homes are not keeping up with regular mortgage payments.
Unfortunately, no exceptions are made for people going through a divorce, and someone needs to keep paying the mortgage.
Even if you have moved out of the family home, you may be responsible for keeping up mortgage payments until the property is sold.
For example, having your name on the contract means you are liable for the whole debt, even if it is a joint mortgage. So, if you set up a joint mortgage with your partner, you have agreed to be equally liable for the debt until it is settled.
It doesn’t matter that you may no longer live on the property. Instead, you must keep paying the mortgage regularly.
Talk to your bank regarding divorce & mortgage
The best idea is to talk to your mortgage lender as soon as possible if you are separating.
This step is crucial if you think keeping up the mortgage repayments will be a problem. Some advice on what to do if you are in mortgage arrears is in this post from MoneySavingExpert.com.
After separating for good, you should also establish your divorce rights to the property. This will prevent your partner from transferring, selling, or mortgaging the house without your knowledge.
Your spouse may own the property in their name alone. If so, a critical step is to protect your property rights after divorce by registering them with the Land Registry.
So, there is much to consider during a divorce or separation. If your relationship has reached the point of breakdown, it is best to consult professionals like a divorce solicitor.
They will have the experience and knowledge to manage matters like property sales during divorces and can give you expert advice.
Selling a house after divorce quickly
If you want to sell your house due to divorce or separation, we can help as a regulated house buying company.
We will make you an offer for your home before, during, or after your divorce or separation.
Our offer will also be made regardless of the condition of your home. Through our straightforward home buying process, we strive to make the sale as smooth and quick as possible.
