The dictionary meaning of divorce is one thing and the meaning we give to it on a conscious, unconscious, emotional, logical, legal level is another. Early in our lives, divorce could have been non-existent in our vocabulary or simply had no direct consequences in our personal life. As we grow older, we experience a whole range of meaning that we are moved or shaped by. Acknowledging and/or speaking the truth about divorce is one of the biggest fears of all time. It could feel like our identity has collapsed, our beliefs and values shattered. Fear of failing, disappointing, hurting, losing our loved ones, our purpose and our identity can weigh heavily on one’s shoulders. We suffer and feel completely lost when we are in our weakest spiritual, emotional, physical, mental and financial state. My divorce process definitely had all these effects on me. It empowered me, disempowered me, challenged me, made me grow, connected and disconnected me, inspired me, freed me, and most importantly made me more authentic, vulnerable and compassionate to myself and to others.
We are raised to open up and share our happiest emotions to the world with pride once we are engaged or get married, and to hide our darkest emotions when we separate. Though, the truth is both marriage and separation are a celebration of a new beginning and ending, aren’t they? So, let’s start by celebrating that and know we are not alone on this journey. There is a whole community out there to support us and give us the strength we need to move forward. Here is some helpful information about divorce and real estate to make things a little easier for you:
1. Buy Out
You need to decide who can and will actually afford to buy the other out or whether you’d prefer to liquidate and divide your assets. Confirm with your mortgage broker or your bank that you will each qualify for a mortgage on your own. I chose to buy out yet to be the mortgage qualifier on both ends. Avoid doing that if possible, as this would have a very negative impact on your own personal qualification in the future.
I am so grateful to my beautiful son, who was 20 years old at the time and lived with me (and still does) after the separation. However, this is not always as easy. Bird nesting seems to be a more common alternative for divorced families with younger kids when the kids stay in the marital home and the parents come and go when it is their allocated time with the children.
3. Home Evaluation
You’ll need a bank appraisal, a letter of opinion by a local realtor before coming to the market. Of course, none of the mentioned assessments guarantees your home sale price until an actual written firm offer is accepted and your property is sold. I personally did all of the above during my divorce to make it as transparent as possible.
4. Home Equity
The estimated market value at the time of your legal separation determines your home equity. This again helped me to divide assets based on a mutual agreed separation date, which allowed me to eliminate unnecessary arguments along the way. Also, inheritance money invested in a property impacts the buy-out, real estate fees, and/or land transfer taxes on buying another property.
You may want to stay at your primary or secondary home, with family, rent a longer-term Airbnb, an executive furnished rental. And if no such option is available, you may stay in separate rooms in the same house, or even have one move into the basement or separated space. I kept our primary residence, consequently keeping every member of my family calm from my inspiring son to my vulnerable parents and my little dogs that I had to support.
6. Interim Expenses
A line of credit and a joint interim account are great sources for managing up-front costs associated with the sale that you can divide these expenses out of the proceeds of the sale. Sometimes, one of the spouses pays these fees and the other gets less equity back. I took on that responsibility which was a real headache and there was no other way around it for me. However, I would not personally recommend this approach to anyone, if there is an alternative option. If you are limited in budget, negotiate to pay certain fees such as legal, staging, repair etc when the house closes.
An approved mediator for both spouses could eliminate a big portion of your legal fees and facilitate open communication between you, the lawyers and the real estate team from finalizing division of the assets, pricing, selling, financing, separation agreement write up, divorce agreement etc. Make sure to hire a mediator who is impartial. I happened to have a family friend mediator, whom my ex-husband listened to and who I respected. If I knew what I know now, I would have hired an approved mediator by both of us without giving grief to a family friend and more importantly to have someone who could have had no connection or emotional attachment to either of us.
I would love to help you making your divorce process easier, by holding your hand and earning your trust along the way. Let me assist in anyway that I can.
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With love and gratitude