Tips to Be Aware of to Protect Your Real Estate Interests when Divorcing

Family lawyers do not always know all the legalities of splitting up assets and liabilities when calculating marital property. It is in your best interest to do some of the homework yourself and be aware of the pitfalls and opportunities. Plus, doing some of the work yourself will save some money you might have paid to your lawyer for doing the same thing. If you are in the midst of an emotional divorce, you tend to overlook key financial decisions. Rather than leaving all the financial details to your family lawyer, you need to get involved, no matter how painful.

CHECK YOUR HOME'S APPRAISED VALUE

Look at your Property Tax Statement to find your home's assessment value within your county. If you do not have your Property Tax Statement, filed in the county recorder's office, you can go online or call to get a copy.

Here is an online link to county recorders in most states.

Some sites require you to enter your Property Identification Number to look up the statement. Sometimes you can look it up by inputting your last name or street address. Look at the entry marked Market Value. Even if you intend to have your lawyer get an appraiser in to appraise the property, you need to be aware that they will look at that number to base their appraisal on. The Property Tax Market Value is typically less than the actual selling price if the house was placed on the market. Therefore, the actual appraisal will probably come in lower than the house could sell for. The appraiser will err on the side of the Property Tax Market value to protect himself in court. This will be a disadvantage to the ex-spouse who did not have the house awarded to him or her in the final divorce decree.

IF YOUR SPOUSE IS UNCOOPERATIVE IN ALLOWING AN APPRAISAL

In order to arrive at a value for the home before you go to your final divorce decree hearing, you need to have the home appraised by a residential appraiser. Sometimes the spouse living in the home will not allow an appraiser to enter the home. In that case, you will need to spend money yet again on your lawyer to get a court order allowing the appraisal. Insist that the attorney fees be paid for by the uncooperative spouse. That fee will then be taken out of his or her half of the property split amount.

QUIT CLAIM DEED

Verbiage that is included in your divorce decree may state that the divorce decree serves as a quit claim deed when filed in the county courthouse records. Your lawyer may make it seem like that is good enough, but beware! Most title companies will not close on a piece of property without a properly prepared Quit Claim Deed, separate from the divorce decree. If your divorce entails a quit claim deed being executed, then by all means, have your lawyer, or a real estate lawyer, prepare a separate quit claim deed and have both parties sign it at the final divorce decree hearing. This will prevent you from having to go back to court when an uncooperative ex-spouse refuses to sign anything after the divorce is final.

MORTGAGE LOANS HELD JOINTLY

If both spouses' names are on the mortgage loan or home equity loan, insist on a clause in the divorce decree that the spouse being awarded the house has 90 days to either refinance the loan in his or her name or sell the house. You may have to go back to court to enforce this if it does not happen.

The longer you wait, the longer the spouse in the home has to stop making payments, default on the loan, and force the mortgage bank to harass the other spouse into making payments. Mortgage banks in some states do not care if you have a quit claim deed or a divorce decree holding you not responsible for payments.

Mortgage banks have tools to collect their money including threatening you with wage garnishment and taking money right out of your bank account, thus wiping out your checking account and leaving you with bounced check fees and no money.

BACK CHILD SUPPORT OWED?

If the ex-spouse does not pay child support and is living in the marital home and has put the house up for sale or is going to refinance per the court order, you can have your lawyer put a lien on the house. Any back child support owed will be set aside for you or the child support agency by the closing company when the house sells. You can even argue for future amounts to be withheld if the ex-spouse has shown a history of non-payment.

You may have to go to court first to get a court order ensuring that the money will be set aside for you. This assumes that there is enough equity in the home to have that amount withheld. Any short sale amount will still have to be made up and you may still be on the hook for the amount that is still owed after the property is sold.

Hopefully, this article has given you some food for thought and will help you to protect your real estate interests during and after your divorce.