Can I keep my house in my divorce?
There are many reasons to keep a family home. We may have set up a home office and plan to continue to work from home, we may be raising children and want to keep that consistency for them after a divorce is finalized or we may simply love the property. Whatever the reason for this attachment, those going through a divorce may wonder whether or not they can keep the family home. In many cases, this is a possibility. Before making this decision, it is important to consider the following.
Is it possible to keep the home?
In Arkansas, most property acquired during the marriage is subject to division during divorce. Arkansas uses the legal theory of equitable division in divorce. This means that although the split will not be a clear 50/50 to each spouse after the divorce, the courts will split all marital property in a manner it deems fair. Courts take a number of factors into consideration when making this split, including the length of the marriage, occupations of each spouse, health, and financial wellbeing of each party as well as any potential tax implications of a finalized agreement.
With this in mind, it is possible to keep the family home. However, you may need to make some sacrifices. In order to keep the home, you may need to buy out your spouse’s share of the home with existing funds. You could also allow your spouse to keep another valuable asset in exchange for the home like business interests, a vacation property, retirement account or a portion of your investment portfolio. Before agreeing to this, it is also important to consider additional expenses that come with owning the home. Does it require a lot of maintenance? Will it need a new roof or kitchen update in the near future? Take all these potential expenses into account before pushing to take on full ownership of the home to reduce the risk of financial concerns in the future.
Fortunately, as noted in a recent piece by Kiplinger, keeping a family home is more affordable now than it was in the past. This is partly due to the fact that we are currently in a seller’s market, making it much more expensive to buy a replacement property if you choose not to keep the home, and also because this has led to low-interest financing for those who may need to refinance to cover an existing mortgage.
How do I go about making sure I actually get the home in the divorce?
It is important to make sure the divorce settlement agreement clearly states that you will receive the family home. It is best to avoid boiler-plate documents and get a settlement agreement drafted to your specific situation. This will better ensure a smooth transition into post-divorce life and reduce the risk of surprises in the future.