Divorce and the family home: what happens to your biggest assets?
Divorce and separation are incredibly emotional life events. When it comes to dividing up assets, there are three things to consider before selling the family home.
Divorce doesn’t automatically trigger the sale of the home, but it’s common for couples to see selling as the best option when people go their separate ways. I’ve sold properties for many couples going through a separation or divorce and know how stressful it can be. Before you rush to sell, here are some important considerations.
Who owns the property?
If the property is jointly owned or held in one partner’s name determines your next steps. You don’t need a divorce order to sell a property or transfer ownership to one partner. But before any sale can go ahead, the real estate agent must get a copy of the Certificate of Title and a signed agreement from each party listed on the title. Once the agent has that, they can list the property for sale.
The next part is written instructions, signed by both partners, agreeing to the listing price, how they’ll respond to offers, and how they’ll accept a sale price, including if the property is sold at auction. While you might already be thinking about moving on, the agent needs clear, written instructions to help you with the sale of the home.
How much will you get?
Selling price can be the biggest source of disagreement between couples and is worth more consideration. When agreeing to a price, it’s not only the headline figure. If you’re selling at auction, do you sell to the highest bidder? If the property is passed in, what lower amount would you agree to? Each scenario has to be considered rather than focussing on how much you could walk away with.
While many couples might want to sell the home as quickly as possible, market forces have a say too. If the house sells for less than the mortgage value, and before assets have been divided, the mortgage will have to be covered from other assets in the property pool, which means that timing is of the essence. It could pay to delay the sale, based on advice from your agent.
Who gets the money?
It’s not simply a matter of selling the property and splitting the money. Contrary to popular opinion, property settlements aren’t simply a 50-50 split. All assets – cash, property, shares, vehicles and more – go into a property pool. Lawyers for each partner will make a claim for an appropriate entitlement. The value of the property, or the proceedings from a sale, go into that pool and split according to the agreed amounts. So, before rushing ahead with putting your property on the market, speak to your lawyers about what you could realistically expect to get out of a settlement.
The property settlement proceedings between the couple will often set a deadline for sale and how costs from the sale will be allocated, providing a measure of certainty for both parties. If you can’t wait and the property is sold, the money from the sale goes into a trust account until matters are finalised.
There’s no avoiding the fact that divorce is rarely pleasant and can undoubtedly be an emotion-charged time. It pays to stay calm and get property advice on what you should do in your situation before rushing into a sale. When you do go ahead with selling, you need an agent who doesn’t see a divorce sale as an easy listing. You want someone who can navigate the situation with tact, who communicates well with each partner, who understands that each situation is different, and can help you realise your worth.
I was born to be in sales. From a very early age, I was serving and helping clients in my father’s hardware business and giving them advice, which is scary. I love working with people, helping them get what they want, and pushing myself to excel. My friends and family that know me well laugh about all the jobs I have done over the years, but it was all to get me to this point in my life, a real estate agent.