MN Divorce Real Estate: Should You Keep the Home or Sell It?

Jul 15

Navigating a divorce involves complex emotional and financial challenges, particularly when it comes to decisions about shared assets. Among these decisions is whether to retain the marital home or pursue its sale. Here’s a comprehensive look at the factors that can impact this important decision during a divorce.

Financial Considerations

Mortgage Affordability: Can you afford the mortgage on a single income? It's essential to assess whether one party can manage the mortgage payments, property taxes, insurance, and maintenance costs independently.

Equity Distribution: Selling the home allows both parties to split the equity, providing a clean financial break. This can be crucial for both individuals to start anew without the burden of a large, shared asset.

Refinancing: If one party chooses to retain the home, it is common for them to refinance the mortgage solely in their name. However, this process can be challenging if the individual does not meet the necessary qualifications for a loan based on their income and credit score.

Market Conditions: The current real estate market can influence the decision. In a seller’s market, selling the home might provide a significant financial gain. Conversely, in a buyer’s market, holding onto the property until conditions improve might be beneficial.

Emotional Factors

Stability for Children: When children are part of the equation, prioritizing their stability is essential. Keeping them in their current home and school district can help foster a sense of security during a challenging period. A familiar environment can significantly contribute to their overall well-being.

Emotional Attachment: The marital home often holds sentimental value, making it difficult for one or both parties to consider selling. However, it’s essential to weigh emotional attachment against practical considerations.

Fresh Start: Selling the home can symbolize a new beginning, helping both parties to move forward without the constant reminders of the past.

Practical Aspects

Maintenance and Upkeep: Managing a home involves ongoing maintenance and repairs. Consider whether the person keeping the home can handle these responsibilities alone or if it would be more practical to sell.

Downsizing: Post-divorce, the original marital home might be too large for one person, leading to higher maintenance costs and unnecessary space. Downsizing can offer a more manageable living situation.

Legal Implications: The division of real estate in a divorce is subject to legal processes. Consulting with a local family law attorney or mediator can provide clarity and ensure a fair division.

Decision-Making Process

Consult Professionals: Consider seeking guidance from a Realtor® who is a Certified Divorce Real Estate Expert (CDRE®), financial advisor, and family law attorney to fully understand the financial and legal implications of your decision.

Evaluate Your Finances: Conduct a thorough financial assessment, considering your income, expenses, and long-term financial goals.

Consider the Future: Think about your future housing needs and lifestyle. Will the home fit into your long-term plans?

Initiate Constructive Conversations with Your Future Ex-Spouse: Whenever feasible, fostering open communication with your soon to be ex-spouse regarding the advantages and drawbacks of retaining or selling the home can pave the way for a mutually advantageous resolution.

Deciding whether to keep or sell the marital home during a divorce is a multifaceted decision that requires careful consideration of financial, emotional, and practical factors. By consulting with professionals and evaluating your unique situation, you can make an informed choice that aligns with your long-term goals and provides the best possible outcome for all parties involved.

Shannon Lindstrom is a Realtor® with RE/MAX Results and a Certified Divorce Real Estate Expert (CDRE®) serving Minneapolis, St. Paul, and the surrounding areas. She specializes in helping individuals navigate the complexities of real estate transactions during divorce. Contact Shannon for expert guidance and support tailored to your unique situation.