Please help, this is a bit confusing…
Here is the deal…The house is worth $600K, the mortgage is worth $250K
joint tenancy on the deed…
How is buy out amount determined?
Market value minus principal?
How about real estate fee? is it accounted for?
Then what if the spouse wants to offer less to the other one?
If the offer is not accepted can she/he sue the partner for divorce?
Then mortgage payments are stopped house goes into foreclosure and then what?
THANKS!
I can tell you what my husband did with his ex, which was actually spelled out in their separation agreement I think.
-We looked at the equity in the house . (in your case 350K)
-We paid for the appraisal for refi
-She refi’d the house and gave us a portion of that equity - I’m sure we got less then we could have if we’d waited around for her to sell it - but that would have meant 3 or 4 more years until kids had graduated and in the meantime it her slow and no pays were ruining his credit. It was totally worth it to have that monkey off our back
If nothing is specifically spelled out in your sep agreement you can negotiate. It depends how long you want to draw this out and how much you want to get out of it vs the problem of owning a house jointly post-divorce and then dealing with the possiblity of whether or not he/she will ever want to sell…if you’ll get $ out of it at that point…if she/he doesn’t keep up mortgage payments and it affects your credit…
The spouse receiving a buy out is entitled to one half of the equity. Based on these facts the equity in the house is 350k, one half is 175k, which would be the buyout amount.
If one spouse is staying in the home there should be no accounting for a real estate commission. If you agree to sell, the proceeds (after expenses and commissions) will be divided equally.
If two parties cannot agree on a distribution they should file a claim for equitable distribution of property and the courts will determine what should be done with the home.
Your house is a very valuable asset, do not allow your marital discord to cause you to lose it.
You should meet with an attorney immediately to ensure you and your largest asset are protected.
than the equitable amount? Is equitable always 50% anyway?
Equitable Distribution is not always 50/50. The statute reads as follows:
There shall be an equal division by using net value of marital property and net value of divisible property unless the court determines that an equal division is not equitable. If the court determines that an equal division is not equitable, the court shall divide the marital property and divisible property equitably. The court shall consider all of the following factors under this subsection:
(1) The income, property, and liabilities of each party at the time the division of property is to become effective.
(2) Any obligation for support arising out of a prior marriage.
(3) The duration of the marriage and the age and physical and mental health of both parties.
(4) The need of a parent with custody of a child or children of the marriage to occupy or own the marital residence and to use or own its household effects.
(5) The expectation of pension, retirement, or other deferred compensation rights that are not marital property.
(6) Any equitable claim to, interest in, or direct or indirect contribution made to the acquisition of such marital property by the party not having title, including joint efforts or expenditures and contributions and services, or lack thereof, as a spouse, parent, wage earner or homemaker.
(7) Any direct or indirect contribution made by one spouse to help educate or develop the career potential of the other spouse.
(8) Any direct contribution to an increase in value of separate property which occurs during the course of the marriage.
(9) The liquid or nonliquid character of all marital property and divisible property.
(10) The difficulty of evaluating any component asset or any interest in a business, corporation or profession, and the economic desirability of retaining such asset or interest, intact and free from any claim or interference by the other party.
(11) The tax consequences to each party.
(11a) Acts of either party to maintain, preserve, develop, or expand; or to waste, neglect, devalue or convert the marital property or divisible property, or both, during the period after separation of the parties and before the time of distribution.
(11b) In the event of the death of either party prior to the entry of any order for the distribution of property made pursuant to this subsection:
a. Property passing to the surviving spouse by will or through intestacy due to the death of a spouse.
b. Property held as tenants by the entirety or as joint tenants with rights of survivorship passing to the surviving spouse due to the death of a spouse.
c. Property passing to the surviving spouse from life insurance, individual retirement accounts, pension or profit-sharing plans, any private or governmental retirement plan or annuity of which the decedent controlled the designation of beneficiary (excluding any benefits under the federal social security system), or any other retirement accounts or contracts, due to the death of a spouse.
d. The surviving spouse’s right to claim an “elective share” pursuant to G.S. 30-3.1 through G.S. 30-33, unless otherwise waived.
(12) Any other factor which the court finds to be just and proper.
Very good answer…