How to Avoid Costly Housing Mistakes Before and After a Divorce

Tuesday, October 15, 2019   /   by Drew Nicoll

How to Avoid Costly Housing Mistakes Before and After a Divorce

Divorce is rarely easy and often means a lot of difficult decisions. One of the most important decisions is what to do about the house.


In the midst of the heavy emotional and financial turmoil, what you need most is some non-emotional, straightforward, specific information and answers. Once you know how a divorce affects your home, your mortgage and taxes, critical decisions are easier. Neutral, third party information can help you make logical, rather than emotional, decisions.


Probably the first decision is whether you want to continue living in the house. Will the familiar surroundings bring you comfort and emotional security, or unpleasant memories? Do you want to minimize change by staying where you are, or sell your home and move to a new place that offers a new start? Only you can answer those questions, but there will almost certainly be some financial repercussions to your decision process. What can you afford? Can you manage the old house on your new budget? Is refinancing possible? Or is it better to sell and buy? How much house can you buy on your new budget?


To help you know what questions you should ask and how to arrive at the right answer for your specific situation, a FREE special report has been prepared by industry experts titled "Divorce: What You Need to Know About Your House, Your Mortgage and Taxes".


You have 4 basic housing options when in the midst of a divorce. Here are two of them:

1. Sell the house now and divide up the proceeds.

2. Buy out your spouse.


It’s important for you to understand the financial implications of each of these scenarios.


1. Sell the House Now and Divide Up the Proceeds: Your primary consideration under these circumstances is to maximize your home’s selling price. We can help you avoid the common mistakes most homeowners make which compromise this outcome. As you work to get your financial affairs in order, make sure you understand what your net proceeds will be - i.e. after selling expenses, and after determining what your split of the proceeds will be. Note that the split may not be 50/50, but rather may depend on the divorce settlement, the source of the original down-payment, and the legislative property laws in your area.


2. Buy Out Your Spouse: If you intend to keep the house yourself, you’ll have to determine how you’ll continue to meet your monthly financial obligations, if you now only have one salary. If you used two incomes to qualify for the old loan, refinancing on your own might be a challenge.


When You Decide to Sell

If you and your spouse decide to sell your home, it will be important to work together through a professional to maximize your return. Differences aside, you both should be present when a listing contract is put together. Both of you should understand and sign this contract, and both should be active in the ultimate negotiations. When You Buy Your Next Home Use the proceeds from your previous home or buy-out to determine an affordable price range for your next home. Maintain a clear focus on getting the right home to suit your new situation. You may wish to review with an agent who offers a house-hunting service to help find a home that matches your new home-buying criteria.


So, there are 2 of the 4 points, plus some extra tips, in an effort to draw attention to this very important topic. If you'd like to see all 4 of these little known facts, I have put together a FREE Special Report titled “Divorce: What You Need to Know About Your House, Your Mortgage and Taxes " which explains these issues in greater detail.

You can grab a copy of that report for free by visiting: or give me a call at 707-380-8057. 

Thank you for reading this week’s blog, and Go Serve Big!
Drew Nicoll
The Nicoll Pallini Group

Your Home Sold Guaranteed or I'll Buy It! So, if you or anyone you know is considering making a move, feel free to give me a call or pass on my number! 707-380-8057