Tips for Divorcing Couples with Real Estate
- Houses out on the market in a divorce situation are fair game for agents looking for a bargain for their clients. Do not empty out one spouse’s closet or let routine maintenance go-these are tell-tale signs.
- There is no correct value for the home. An appraiser will value it based on different criteria than a real estate agent. In an “up” market, agents can support higher values by “grossing up” the price based on historical appreciation rates, while appraisers are required to use the most recent sales only. It sometimes makes sense to use more than one approach and split the difference.
- Both parties need to agree on the listing agent if the house is being sold. If you need to sell and are interviewing agents, be sure not to give them any information that may come back to haunt you, such as how much you need to get for the house or the divorce status-there is no confidentially requirement unless and until you sign a listing agreement with one of them. They may discuss your story with other agents.
- You need to live in a house for 2 of the last 5 years to get the capital gains exclusion when you sell it. Protracted divorces make this issue more likely to come up.
- Many women commit financial suicide to remain in the family home after the divorce “for the kids”. Less expensive alternatives do exist and the kids who participate in finding them may be better off with a parent who is not financially strapped.
- If you decide to buy, use a buyer’s agent. They are legally required to represent your interests and many have been through divorces themselves and can be a great help. They will get you through the paperwork with as little stress as possible.
For more information on divorce, contact Sage.