Among all joint acquisitions, the house stands as the largest asset in your possession. For this reason alone, a jointly acquired property purchased during the marriage period will also be the biggest “bone of contention” when it comes to the division of assets in the course of the divorce.
Sell, hold or bequeath? Make the right decision!
Without a prenuptial agreement, both parties own 50 percent of the house. This means, whether you want to sell or keep the house, that each spouse has the right to half of the regular market value. If the sale is on the table, the financial division is still relatively simple. It becomes more complex if you want to remain in the house and are therefore faced with the problem of paying out half. Also the right time of sale or a house sale with a still jointly existing financing should be planned carefully.
You can protect yourself from making a wrong decision by contacting us real estate agents and expressing your concerns. Based on your possibilities and ideas, we will then find the best way and different options that exist in the event of a divorce in relation to your house.
Division of assets through a prenuptial agreement
Advisable in case of joint real estate ownership!
Even if a prenuptial agreement is unromantic and rarely a topic of conversation for newlyweds: If a divorce should occur, the contract arrangement made in advance will simplify your financial affairs. At the latest when you buy a house and finance it together, you should not exclude the prenuptial agreement. Through this contract, you can exclude the possibility that, in the event of hardened fronts, a foreclosure of the property will occur and thus a loss of not infrequently 50 percent of the real value.
This way, you can contractually stipulate how the house will be divided in the event of divorce and what actions will be taken. At a time when you are in agreement and in love, such decisions are always easier than in the course of the divorce.
Before selling the house/ paying off the partner, it is essential to have the market value determined.
Generally, you need the value of the property. When selling, but also when paying off a spouse who is moving out, the fair market value comes into focus. Keep in mind that the tangible value and your price that you paid for the house at the time is not sufficient as a basis for a current valuation. Due to high demand and rising real estate costs, you can assume that the value of your home has increased in recent years.
Without a prenuptial agreement, a market value of 200,000 euros would automatically result in an entitlement for both partners that includes 100,000 euros in the house. If your property is still being financed, these details should also be clarified and should not lead to additional differences in the course of the divorce.
Who continues to service the real estate financing?
As a rule, in a marriage it can be assumed that you have taken out the loan for your house together and repaid it jointly up to the time of separation. But what happens if you file for divorce and no longer jointly occupy the property? If you have both signed a joint property loan agreement, you are also both still obliged to service the bank’s liabilities.
In the event of repayment difficulties, the bank reserves the right to sell your property by forced sale. In order to avoid this problem, you must take action yourself and make a clear arrangement for the further handling of the liabilities. If one of the spouses is removed from the land register and the house is transferred as a result, the problem of the loan liability can be settled. In this respect, it is necessary that one partner clarifies his or her renunciation in the course of the divorce and that the other partner is also able to guarantee the financing independently and as a single person.
More on divorce:
House sale
A jointly occupied and financed house is usually the focus of a divorce. If neither partner wants or is able to keep the house, in most cases it comes down to a property sale. There are several solutions you can consider and contrast. Most divorcing couples choose to sell the house to a third party, as this method results in the fewest disputes. You part with existing debts together and exclude the need to continue paying off a home loan together. All about selling your house.
Separation and house
Separating from your partner is a trauma. To ensure that the decision about your jointly purchased and financed home does not become traumatic, you should definitely opt for professional advice on the various possible solutions. Do you want to keep your home despite separation and pay off your former partner? Or are you interested in selling and would like to achieve realistic proceeds on disposal? More information on the topic of separation and house.
Keep house
For families with children, housekeeping is often high on the agenda in the event of a divorce. In many cases, the partner with whom the children remain stays in the house. So that the children can remain in their familiar environment and are not additionally burdened by the divorce, this option proves to be the best solution. However, the desire to keep the house is of course linked to the respective financial situation and to agreements made. More on the subject of keeping a house.
