November 12, 2018
When married couples in Pennsylvania and around the country divorce, the family residence is usually the most valuable asset discussed during property division negotiations. Deciding how to deal with the family home is challenging because this is often an emotional issue, but making decisions based on sentiment rather than pragmatism can cast a long shadow and should be avoided.
A straightforward way of dealing with real estate during a divorce is to sell it and divide the proceeds, but people may be reluctant to leave the home where they have raised a family. Spouses can surrender their rights to ownership by signing quitclaim deeds in return for cash or other assets, but this can lead to problems in the future if the person who retains the property fails to make mortgage payments in a timely manner. This is because banks are not bound by the provisions of divorce settlements and will pursue any individual who signed mortgage documents when accounts fall into arrears.
To avoid such situations, spouses should take steps to ensure that all loans secured by assets are paid off before those assets are addressed during property division negotiations. Another benefit of this approach is that obtaining a new mortgage will involve running a title search and getting the home inspected. This can uncover unknown title issues that could affect negotiations like liens or easements and property defects such as structural issues faulty wiring or plumbing problems.
Going through a divorce usually involves making financial adjustments, and experienced family law attorneys may advise divorcing spouses to consider the costs of maintaining a large home on a single income before settling on a strategy for the family home. Attorneys could also recommend that married couples avoid the emotional toll of contentious property division negotiations by entering into postnuptial agreements.
