Divorce and your home: deciding where to live after divorce
“Where will I live after the divorce?”
This is one of the most common—and difficult—questions people face when they are going through divorce.
Oftentimes, much time and energy are spent on who will get to keep the family home. While the desire to keep the family home is usually fueled by emotion, I encourage you to look at some of the practical matters before making such a big decision. Here are some of the most important things to consider when deciding whether to relocate after divorce.
Evaluate your income
If your desire is to stay in your current home, you will need to determine whether you can afford to do so. This is especially true for women. According to a 2017 report from the U.S. Government Accountability Office, in couples who divorced or separated after 50, women saw their household income fall by 41%, compared to a drop of just 23% in men. You will have to assess whether your after-divorce income will be able to support staying in your current home.
Also consider that prior to the divorce, the current household income supported this one house. After the divorce, the same income will be needed to provide for the expenses of two houses. It is important to make sure there is adequate income to support the current home, as well as a second home for your spouse.
Consider your mortgage
Most mortgages are held by both spouses. If you receive the home in the divorce, you will now be the only owner of the house, which means you will need to refinance the mortgage.
There are several factors to consider in this situation. You need to make sure you will qualify for the mortgage, which is based on your assets and income after the divorce. You also need to understand that your payments could increase if interest rates have increased since the time you obtained the initial mortgage.
Keep additional expenses in mind
There may very well be new additional expenses needed to maintain the house after the divorce. For example, if the spouse that mowed the lawn or carried out household maintenance or repairs is the one to move out, you may need to hire someone to complete these tasks.
The bottom line
I understand the emotional importance of keeping the home, and in many situations, it can work out for one of the spouses to keep the house after the divorce.
I encourage you to go into the situation with eyes wide open, so you aren’t surprised or put in a stressful situation after the divorce due to lack of planning. Employing a professional, like a financial planner, can help ensure that this transition is a smooth and successful one.
Get your free Empowered Divorce Guide
I invite you to click the link below, and we will send you our free Empowered Divorce Guide. This workbook will guide you through this process and offer two vital steps to prepare for divorce.
If you are feeling overwhelmed and would like to discuss these matters with a professional, we also offer a free 30-minute call to walk you through the guide and answer your questions.
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