Property division is one of the most complicated aspects of a Maryland divorce and one of the biggest questions people have involves what happens to the house.
You have a few different options when it comes to your house. Before you decide which option works best for you, the house should be appraised to get an accurate value of its worth. You can have one appraisal done if you and your spouse agree on an appraiser, or you can each use your own appraiser.
Once you have determined a value for the house, you must decide what to do with it. If you and your spouse agree on who is going to keep the house, the situation becomes easier.
You must be able to afford the house if you want to keep it
However, whichever spouse keeps the home must show that they can afford it, or a court may not allow it. If neither spouse can afford to keep the house on their own, the court could order that it be sold.
Maryland courts divide marital property in equitably, or fairly. This means if your house is sold you will generally be ordered to split the proceeds. The exception to this is when one spouse is given another valuable marital asset. The other spouse might then receive all house proceeds to achieve a fair outcome.
When one spouse keeps the house, the other spouse’s name must be removed from the mortgage. This is done through refinancing.
The purpose of mortgage refinancing
Mortgage refinancing not only removes the other spouse’s name from the mortgage, but it also allows the spouse receiving the house to obtain cash to buy out the other spouse’s share of the house.
Sometimes spouses choose to divorce but keep the home in both their names. This is usually done out of necessity, such as when children are involved or when neither spouse can afford the house on their own but they do not want to sell.
A house is typically the most valuable marital asset in a divorce. Therefore, it is important to thoroughly evaluate your situation and options before deciding what to do with it.