Can You Afford to Keep Your House After a Divorce?
If you are going through a divorce, you may wish to keep the family home after the divorce is finalized. But even if your spouse agrees to this plan, you’ll need to consider whether or not you can realistically afford to do so.
Here are some of the considerations to take into account when determining whether you can afford to keep your house after going through a divorce.
- Home value: Determine the current value of your home. You may be able to have a realtor provide you with an estimate of fair market value for free. Otherwise, if you need a more exact figure, you will need to work with a certified real estate appraiser. This service will typically cost several hundred dollars.
- Equity: How much equity do you have in the home? This refers to the current value of the home less any debt currently owed against the house. You’ll need to buy out your spouse’s share of the equity, which may be a significant amount of money. Home equity will not automatically be split 50/50, but that can at least serve as something of a basis for estimating equity.
- Ability to refinance: If you decide you want to keep the house and have agreed to a buyout figure with your spouse, you’ll need to figure out how you’ll proceed with the mortgage. In most cases, it will be in your best interest to refinance the loan. Doing so will help you find a more feasible monthly payment amount. With your income significantly changing, you might not be able to afford your previous payments. Refinancing may make it possible for you to stretch out those payments over a longer period of time, thus reducing your monthly payment amount.
For more information about keeping your home after a divorce, contact an experienced Long Island divorce lawyer at Bryan L. Salamone & Associates.