Why You May Not Want to Keep The House In Your Divorce
In dissolution of marriage cases in Orlando Florida, one of the core legal issues that need to be addressed by the divorce attorneys is that of dividing the assets that were accumulated during the years of the marriage.
The most common asset that needs to be divided in divorce cases is the marital home. It is a standard tradition in the United States for people to get married and then buy a home. This order of events is so common in our society that it almost feels as though young newlyweds are expected to purchase a house as soon as they get home from the honeymoon.
Because of this expectation, it is extremely common for divorce cases to address dividing marital homes with mortgages.
Why would you want to keep a home after your divorce that you cannot truly afford?
One thing that too few divorce attorneys counsel their clients about is whether or not they can truly afford the payments and the upkeep on the house after the divorce. This is an extremely important conversation that any divorce lawyer needs to have with their client especially if their client is intending to stay in the home after the divorce.
Far too often does a divorcing spouse cling to the house as their last sense of security, sanity, and stability in an unstable situation. The emotional attachment surrounding the house overwhelms all logic and reason especially when it comes to budgeting and what that person can realistically afford after the divorce.
Just this morning, I conducted an initial consultation with a young man who was getting ready to file for divorce. He told me that he and his Wife had a mortgage payment on their new home of $1,400 per month plus another monthly payment to the HOA of about $200 per month for a total monthly payment just to keep the house of $1,600.
He indicated to me that the Wife who earns $2,333 per month intends to remain in the home and to be responsible for the mortgage, the HOA, and all the other associated expenses on her own after the dissolution of their extremely short-term marriage.
Now I am no math genius, but I do know that after taxes if she’s lucky the Wife is going to bring home $1,800 to $1,900 per month. Just paying the mortgage and the HOA is only going to leave her $300 a month to live on.
After you account for electricity, other utilities, cell phone, car insurance, gas for the car, car payment, health insurance, and food there is absolutely no way that this woman is going to be able to survive and keep that house.
Regardless of this obvious math, she is still clinging to the thought of keeping this house. Even though it will financially destroy her and most likely end up in a short sale or a foreclosure the only thing she cares about in the divorce is keeping that house.
Sometimes your financial future after divorce requires you to let go of the house
I believe that in this country over the next 20 to 30 years we are going to see a crisis of epic proportion because not enough people are saving and investing for retirement.
I am a huge proponent for recently divorced people to set up a responsible written budget, not live above their means, and to aggressively save and invest for retirement. This will be especially important given the fact that social security is nearly bankrupt.
It breaks my heart how often I see young struggling individuals going through a divorce who are insistent on keeping a house that they cannot afford just because it represents some false security to them. They do not realize that they are dooming themselves to a life of financial struggle and no ability to ever save to live a dignified retirement.
What divorcing couples need to do is to sit down with a competent lawyer who has their best interest in mind and to have an honest conversation about whether or not they can truly afford to stay in the house after the divorce.
If it is determined that a divorcing party cannot truly afford to stay in the home after the divorce then they will need to advocate for the home to be sold and for the net proceeds, if any, to be split between the parties.
This honest conversation with your lawyer can save you years of heartache and if the other party really wants to keep the house this can give you some good negotiating leverage to resolve other issues in the case in a way that are favorable to you.