Buying or selling real estate during a divorce can be a complicated endeavor. In the best of times, selling a home with a partner can be stressful. Selling a home with a partner you no longer see eye to eye with can seem impossible.
Additionally, you need to consider where you will live after your current home does sell. Whether or not you can (or should) buy a new home during your divorce will depend on where you live and the cooperation of your current spouse.
You should always consult with your divorce attorney before making any home-buying or selling decisions.
How Can We Sell Our Home During a Divorce?
“If you have filed for divorce, do not list or sell your home until you and your current spouse are in agreement on selling,” notes Adam Gurney of Gurney Law Group in Chicago. “If you’re both in agreement, a court order can easily be obtained.”
In the event that you and your spouse can’t agree on selling the house, perhaps your spouse intends to continue living there, you have two options.
1. Your spouse can purchase the house from you as long as they can afford to buy you out and qualify for a new mortgage.
2. You can go to court and ask the judge to order the home to be sold.
The sale of your home will likely be the largest asset that will be split between you and your soon-to-be-ex. While moving out after you’ve decided on divorce may seem like a no-brainer, it can weaken your claim to ownership and affect how the assets are split.
Can I Buy a New Home During a Divorce?
Once you’ve decided to sell your current home your instinct might be to start searching for a new one. But Gurney cautions against this, “When buying a home,” he says, “it’s important to understand the law only recognizes two different scenarios: divorced and not divorced.”
“Even a separation still means you’re married,” he continues. “Therefore, if you purchase real estate before your divorce is finalized it becomes marital property.”
If you and your spouse are on good terms it may be possible to buy a new home during your divorce if you live in a community property state. Title companies in community property states will require your spouse to sign a quitclaim deed. A quitclaim deed releases your spouse of interest in the newly purchased property. Illinois is not a community property state so the purchase of your new home will be considered a marital asset.
A fresh start in a new home may be tempting, but until your divorce is finalized, you should wait to make this purchase. An experienced REALTOR® and a knowledgeable real estate attorney can help you time the sale of your current home and the purchase and financing of your new home to avoid these legal complications.
