The harsh reality of high divorce rates makes this the #1 hot topic we address on a monthly basis. It may not apply to you, but at a minimum, you know someone who’s currently working through a divorce. My blog this month will help answer some key questions:

• How to facilitate the sale when spouses are at great odds?
• Who stays and who goes?
• Do you sell or cash the other spouse out (and how does that work)?

Last month, I touched on how to sell privately without nosey neighbors spying on your situation (Read “How To Sell Privately During A Divorce). This month, I’ll give some tips on hot-button scenarios.

One stays, one goes: If one chooses to stay, the other spouse will want to be paid out their portion of the equity. First, you need to know what the home is currently worth. A formal appraisal is the most “indisputable” way to determine the home’s value. Our team can easily run comp reports, but in divorce situations, it can be common for one spouse to think it’s worth a different number (because they want more money from the pay-out). We have appraisers we can refer you to. Second, you’ll need to know the difference between the appraised value and the mortgage balance (your current equity). Third, the divorce attorneys will likely determine a split.

How do you pay the other spouse out?

You’ll need to speak with one of our preferred lenders. They will typically recommend a cash-out refinance. Remember, for the spouse staying, the payment will go up…significantly. Reason being, rates are much higher today AND you’re cashing out some equity, which means the mortgage balance increases.

Opt to sell: This is the most common because of what I mentioned above. The spouse staying likely doesn’t want a massively higher payment, so they choose to sell. First, I’ll help determine your home’s value. Second, I’ll run an estimated Net Sheet to show what you’d make when the home sells. Third, you agree on your listing agent and get the home staged, prepped and listed. At closing, we’ll work with the closing attorney to make sure the funds are divided appropriately.  

When choosing to sell, both spouses need to be cooperative, otherwise this turns into a battle that everyone loses.

PRO TIP: Agree on a bottom line sales price upfront in writing. Otherwise, one spouse can (and often will) sabotage offers. We can help facilitate this within the listing agreement.

Emotionally Charged: Keeping the peace and everyone informed is game changing. We’ve seen other realtors drop vital details, and let me tell you, emotions are raging on a Level 10. We’ve seen contracts terminate days before closing because a spouse felt they were left out of the details (aka, the fastest way to blow up a sale). Use an experienced team, like The Wistrick Team, to protect you against these scenarios.

If you’re needing to sell due to divorce, we can chat more about this privately. Feel free to call me at 404-932-5564 to discuss further.

Talk soon,

Mike