one of the most challenging aspects of a divorce is that you will be forced to answer questions that are extremely important to the future of your life and that of your children. I don’t think anyone likes to constantly be confronted with questions and issues that will have long-ranging impacts on their life. Most of us were just rather go about our lives and live them to the best of our ability without having to constantly be confronted with important in potentially life-altering questions about our health, our relationships, our family, and our children.
However, not only does divorce cause you to confront questions just like this, but a divorce will also cause you to confront many questions just like this in a relatively short period. In many divorce cases, they can seem like the important questions you have to answer in a divorce are almost like waves at the beach. These waves come crashing down over and over and over again without any regard for whether or not you are unstable ground yourself.
You should use this metaphor as a way to and as a motivator to prepare for your divorce. The important questions in life-changing issues will come regardless of how prepared you are for your case. They should be all the motivation you need to start thinking about the decisions that you will make within your divorce case and to prepare as best you can so that you are not caught flat-footed when it comes to any one area.
When it comes to your finances, one of the most important assets that you have in your family home. Not only does the family house represent a great deal of your net worth but it also represents a lot of memories and emotional aspects of her life as a married person. The idea of parting ways with the family house as the result of a divorce can be enough to cause consternation and sadness in a time where you can ill afford to lose your cool and not focus on the objective components of your case.
With the family home carrying so much importance tear case into your life I believe that we need to talk today about all of the different issues that will come into place surrounding the home during your case. The discussion of what to do with the family home in a divorce only touches on the financial topics it touches Additionally on issues related to your family and your children. That’s the thing about divorce: so much of the subject matter isn’t merely limited to topics of one’s variety or another. Many, if not most, issues in the divorce tend to relate to topics that crossover 2 family or financial problems and consequences.
With all that said, today’s blog post from the law office of Ryan Fagan is going to focus on suggestions for you to consider as you begin to think about whether or not 2 part ways with your family home in the divorce. There are certainly arguments to be made for either position. Your job during your divorce is to determine what are the relevant circumstances to your case in what outcome will be had based on the decisions that you make. What is right for you and your family may not be right for your neighbor or your coworker.
Community property in Texas divorce
Texas is a Community property state. This will affect how property is divided in your divorce. The law in Texas treats property differently than how it is treated in many states during a divorce scenario. As a result, you need to be aware of what Community property is, power affects your life, and what impact it may have in a divorce scenario involving your home. What many people do not understand is that Community property is that just something that involves bank accounts and retirement accounts. Rather, Community property impacts a wide range of issues relating to your finances.
All property at the time of your divorce is presumed to be Community property. This means that to prove that various assets belong to you or your spouse separately, that evidence would need to be shown showing that the property was acquired before your marriage or during your marriage either by inheritance or gift. If there is any disagreement on the community or separate property nature of an asset then both sides would have to submit evidence to a court to prove that the property belongs in either of your separate Estates or the community estate.
If the property was acquired during your marriage then it very likely will be classified as Community property in your divorce. Why is this significant? Well, cover if you and your spouse have been married for an extended period then it is likely that most of the property that you own will be classified as Community property. With that said, the property would then be able to be divided up by a family court judge in your divorce in some former fashion. Whether or not your case makes it to a courtroom is a different story altogether. However, what you need to know is that there is a high degree of probability that your family home is Community property and therefore eligible to be divided in a divorce.
This is the $1,000,000 question that we need to ask ourselves today. For some of you, this will be a very literal question: how should you handle the division of your marital home in your divorce? Fortunately, there are only so many things you can do with a home after a divorce. On the other hand, the emotions and circumstances that you may be facing in your divorce are limitless. This provides us with an interesting backdrop to discuss what you should be considering and how to proceed when it comes to the matter of your family home in a Texas divorce.
What can you afford to do?
Believe it or not, the question of what you can afford to do with your marital home is the most important question that you can ask yourself. I know that your children come first in your divorce. Trust me: if I were getting divorced my kids would be the primary concern, as well. However, the reality of the situation is that you need to keep in mind that your home is the largest financial asset in your life in all likelihood. Therefore, you need to be concerned about the home beyond merely thinking about it in terms of a place where your family has made memories.
At a certain point, the discussion needs to be as much of a math discussion as it does have a relationship and family discussion. The value of the home, the amount of equity you have in the home, your employment situation, and your future finances all need to be considered. This is a lot to think about in a relatively short period hopefully you have considered this question previously and have thoughts on what is best for you and your family. If not come on let’s walk through how you may want to analyze the situation.
First of all, we are in the midst of probably the hardest housing cycle of the past 15 or 20 years. Despite the downturn seen by the pandemic and its impact on the oil and gas industry, home values in Southeast Texas have risen substantially in the past year and a half. What that means is that your house is likely worth more money now relative to your mortgage than it was at the beginning of the pandemic. They should give you some pause when considering what to do with the house and what is in your family’s best interest.
Once you have determined the degree of equity you have in the home you should consider your life moving forward. If you want to stay in the home then you need to consider whether or not you can afford the payments on the home as far as the mortgage is concerned. This is not a situation where I would recommend that you hope and pray that you will be able to make the mortgage payments after your divorce. Rather, you need to run a detailed budget of your my after the divorce and then look back to see what monthly housing costs have been in that home over time. Only when you have done this should you consider what to do with the home.
If it does not make sense for you to remain in that house then you should consider selling it or allowing your spouse to own it without you after the divorce. There is no good reason for you to remain in a house that you cannot afford. This is true even if you have children who are under the age of 18. It is much wiser to move from the home with your children than to attempt to stay in the house for the benefit of your kids. Nobody benefits from staying in a house that you cannot afford. Your children will be must widths off if you choose to stay in that house and cannot afford to do so.
Selling the home after a divorce is not at all uncommon. I think it is probably the most likely outcome was your case to go to a trial. Talk to your attorney about the options when it comes to selling a house and what needs to be done to begin that discussion with your spouse. Additional provisions will likely need to be included in your final decree of divorce. Such as: selecting a realtor, determining how to split the equity between the home, and a timeline for all of the above. None of this can likely be solved overnight but rather takes intentional and well-thought-out planning.
One last word on staying in a home that you may not be able to afford. I would not recommend staying in a home that you cannot afford. Additionally, I would not recommend relying upon special maintenance or contractual alimony to help make mortgage payments. receiving payments like these can be a great help to your budget but the degree to which you are exposed pays can vary from month to month. Choosing to make mortgage payments based on the willingness and ability of your ex-spouse to pay you special maintenance or contractual alimony does not sound like a good plan.
What can you do with the money you receive after selling at home?
If you do choose to sell your family home idiot a voice that you will have options as far as what to do with the proceeds of the sale. You will need a place to stay after your divorce which could mean either buying a new house or renting for some time. Mounting would allow you to make sure that your finances are in order and plan for the future depending on the specific circumstances of your case. You may even need to move for a new job or to be closer to your children. Either way, there is nothing wrong with renting for some time after your divorce.
The money that you get from the sale of your home could also be used to pay down the debt that you have accumulated over the years. The number one factor of what stands in between you and growing wealth is usually debt. By selling your family home you will have removed a major source of debt in your life: here mortgage period from there, if you have debt associated with the divorce, credit card debt, student loans or anything in between you can use the equity in the home to pay down these debts. Anybody leftover could be used to start an emergency fund or build up a down payment for a new home.
The point is that you need to be intentional with the money that you received from the sale of your home. Believe me when I say that if you are not intentional with his money you will find that the money goes away rather quickly. There are always avenues to spend money and not having a plan will cause you to spend money in ways you may not intend. Rather, having a plan and sticking to it when you do decide to sell a home can be a great benefit to you
What are key documents if you or your spouse remain in the home?
If you or your spouse remain in the family home after the divorce is over with he will need to include certain documents in the divorce process which allows for a more straightforward approach to the subject. I have seen people go through divorces in this situation without these documents in place which can often create a substantial degree of problems for these people from a relational and financial perspective.
For one, if you are leaving the family home then you need to execute a special warranty deed which essentially deeds your share of the home to your style. This way he or she will be able to retain full ownership of the home after the divorce without any risk of you asserting any ownership stake. It would be awkward, after all, for you to be able to enter the family home in theory because your name appears on the deed to the home. The special warranty deed would wrap up any loose ends and make it clear as to the ownership positions each of you has.
finally, a deed of trust a secure assumption should be executed by your spouse will be remaining in the house. The deed of trust a secure assumption will allow you to foreclose on the home if your spouse is unable to make the mortgage payments. Keep in mind that unless a refinance is done your name will remain on the mortgage to a home that you do not reside in nor do you have an ownership interest in. This can be a precarious position for you to be in. Rather than rely upon your ex-spouse to make mortgage payments in full each month the deed of trust is a secure assumption that protects you in your financial interest. A key point to remember is that a refinance attempt on the mortgage can be recommended but a lender does not have to approve your spouse.
Questions about the material contained in today’s blog post? Contact the Law Office of Bryan Fagan
If you have any questions about the material contained in today’s blog post please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed family law attorneys offer free of charge consultation six days a week in person, over the phone, and via video. These consultations are A great way for you to learn more about the world of Texas family law as well as to learn more about how your family circumstances may be impacted by the filing of a divorce or child custody case.