Should You Keep the House During Divorce?

Should you keep the house during divorce? Well, it’s not just about the house, is it? There is no way you’re letting go of the car, the jewelry, the investments, your pension, your hard-earned income, or the Baccarat crystal goblets either. And you’re pretty adamant your divorce attorney will agree.

Unfortunately, the law and recent statistics are not in synch with you. According to financial studies, divorcing individuals need a more than 30 percent increase in income just to maintain the standard of living they had before the divorce. Divorce is like that. It’s really about loss and opportunity. But the fact is the loss is harder on women. One in five women fall to poverty as a result of divorce, while men experience a loss of between 10% and 40% to their standard of living. As devastating as those statistics may sound, divorce is not just about the economic leveling. Sometimes your life and the quality of your inner peace is more important than the house with the gourmet kitchen. Divorce could also be an ideal opportunity for you as a couple, and then as an independent woman, to face reality and get out of debt, or to finally sit down and work out a long-term financial plan for your children’s education.

What follows is a practical conversation about whether or not you should keep certain assets in the divorce. How you are going to come to terms emotionally with this division of assets, or how you are going to take steps to protect yourself and rebuild your life is better discussed in a series of coaching sessions or by reading this article about divorce recovery.

DIVORCE & THE FAMILY HOME – PROS AND CONS OF KEEPING IT

There are a few questions you need to ask yourself where the property is concerned. The first is whether you would be able to keep up with the payments and maintenance of the property on your own and whether you would have enough cash to buy your partner out or qualify for a loan to do that. If this is going to place you under pressure, you may want to consider downscaling a bit in order to still live a comfortable life.

The advantages of keeping the home in divorce include:

• Continued stability for the children
• Maintaining an asset that will form part of the estate
• The frustration of moving is not added to the stress that a divorce brings

The disadvantages of keeping the home in divorce include:

• Mounting financial pressure due to loans or reduced saving
• The full cost of the maintenance of the property rests on a single pair of shoulders
• The possibility that there is no access to funds to buy the other spouse out, which could cause ongoing financial pressure

What if neither or you wants the house, or can't afford to keep it? What about other debts, what do you do about those? How do other responsibilities impact the situation?Read on...