What Happens to the Family Home in Divorce?
Family Law
While no one wants to lose money in a divorce, decisions about the family home often evoke the strongest emotional reaction. In Pennsylvania, the process involves legal principles of equitable distribution and temporary possession orders. Because there are many factors involved in making this type of decision, it’s important to seek out professional legal assistance during the asset division process.
Is the Family Home Marital Property or Separate Property?
In Pennsylvania, any property acquired during the marriage is considered marital property. It doesn’t matter whether it’s in your name or your former spouse’s name on the title. If your home was purchased during the marriage, it is counted as marital property.
However, it’s also possible that part of your house may still be marital property, even if you purchased it before your marriage. If the home’s value grew while you were married, then this increase in value is considered marital property.
Pennsylvania considers the following assets and debts as marital property if they were purchased after your marriage started.
- Investments, like stocks and bonds
- Retirement accounts
- Family home
- Any appreciation in the value of pre-marital assets
- Debts acquired during the marriage
- Vehicles
Meanwhile, separate property is any of the assets and debts you took on before the marriage and kept separate from the rest of your finances. If you received an inheritance or gift during your marriage and kept it separately, then this is counted as separate property.
Temporary Possession: Who Can Live in the Family Home Before You Finalize the Divorce?
The tricky part is determining who can live in the family home before the divorce is finalized. Either spouse can live in the home until you wrap up the divorce. However, for the stability of your children, courts will typically provide temporary custody to the custodial parent.
Whoever is living in the house is generally responsible for paying the mortgage, utility bills, homeowners’ insurance, and taxes. They also must pay for maintenance and repairs. If the spouse cannot afford to cover these costs, the courts may provide something known as mortgage deviation, which is essentially temporary financial support that helps with mortgage costs.
How the Division of the Family Home Works
Obviously, the family home can’t be simply divided into two parts. Pennsylvania requires equitable distribution of assets in a divorce, which doesn’t mean assets have to be equally divided.
When making the decision about dividing assets, the judge will consider how long your marriage lasted, the employability of both spouses, ages, health levels, tax implications, child custody needs, the feasibility of a sale, and any contributions as a homemaker or caregiver. They’ll also look at each spouse’s existing economic needs when the divorce is finalized.
Then, the court can divide assets in a range of different ways. Since they aren’t bound to a 50/50 split, they can divide things 60/40, 80/20, or in any other way that makes sense.
Here are a few different ways that the family home could potentially be split in a divorce in Pennsylvania.
Sell the Home and Divide the Proceeds
One option is to simply sell the home. Mortgage expenses and debts can be deducted from the sale price before the remaining funds are split between both spouses. Often, this option is chosen when both spouses can’t afford the home or simply don’t want to stay in it anymore.
Give the Home to One Spouse
In this scenario, one spouse can refinance the mortgage in just their own name. Normally, the divorce settlement will give the spouse a set amount of time to complete the refinancing process. Then, the funds are used to buy out the other spouse’s share in the equity.
Opt for a Deferred Sale
Sometimes, spouses decide to continue joint ownership for a set amount of time. For example, they may want to wait until their kids graduate from high school. In this scenario, the equity is split once the final sale is made.
In all of these instances, the family home has to be balanced by other financial debts and assets in the divorce. If one spouse keeps the house, the other one will likely receive a larger share of retirement funds, investment income, or cash.
Why You Need Professional Legal Help With Dividing the Family Home
When it comes to a divorce, you need the best legal assistance possible. Your family home is more than just an asset. It holds all of the memories with your children and loved ones. Once the division of marital assets is complete, you’ll also have to consider the tax implications and whether you can afford to continue the mortgage on your own. By working with a Pennsylvania divorce lawyer, you can get the legal support you need to understand your legal case.
Learn more by giving our PA divorce attorneys a call today at (570) 676-5212.
