How to Sell Your Home While Getting a Divorce
We’ve all watched those scenes in movies where one party in a divorce is “taking the house.” Usually this trope accompanies a dramatic story line
involving a messy divorce in which at least one party acts contentiously. But in reality, divorce can often be less complicated than that! For one thing, many mid-divorce couples choose not to keep a house that comes with baggage. For another, selling is a great way to fairly divide assets and move on.
You might be thinking that the notion of selling your home in the midst of the divorce sounds complicated on top of an already complicated situation. But this is where an experienced real estate agent comes into the picture. The fact is, any agent worth their salt has seen this scenario before. And true professionals know how to navigate said scenario with grace, and with everyone’s best interest in mind.
Therefore, we recommend that any parties interested in selling their home during a divorce secure a trusted agent. But until you do, check out our guide for selling your home while getting a divorce to figure out your next steps.
Divorce in Oregon: Basics of Dividing Property
The first thing to understand in your home selling journey is how divorce and real estate law work in Oregon. Oregon is known as an “equitable distribution state.” That means that if a couple can’t work out a division between themselves, a court can step in and decide what a fair division of assets looks like. Take note that “equitable” doesn’t mean equal, as in a 50/50 split. The court may take into account other aspects of the dispute.
But Oregon law does lay out a pretty clear picture of what constitutes marital property. According to DivorceNet, marital property encompasses any assets acquired during the course of the marriage. So if a couple purchased a home while married, that home can be split between the two parties. That’s regardless of whose name is on the deed. Separate property, on the other hand, encompasses any property purchased before marriage.
So is your deed only in your spouse’s name? No need to panic. An amicable division of the proceeds of your home sale is very much in reach.
Some of the Most Common Reasons for Selling Are Death and Divorce
If you spend any time checking out the real estate blogs, you’ll find Realtors referring to the “D’s” of real estate. The list can go on and on, but
the real top of the crop are: diapers, death, and divorce. Diapers: families upgrading to a bigger house or buying for the first time to accommodate a new child. (Or, during Covid-19, relocating to be near family.) Death: children of older parents selling the family home as the parent ages or after they die. Divorce: well, you know why. The divorce rate in the U.S. currently sits at 40-50%.
According to the National Association of Realtors’ latest data, the #3 reason that people chose to sell their homes last year was a “change in family situation,” which includes divorce as much as it does new children. And let’s keep in mind that the #1 reason, “a desire to move closer to friends and family,” saw an enormous spike once the pandemic hit. What this suggests is that a huge number of folks are selling their homes due to divorce. And real estate agents know that – they handle it all the time!
Agreeing on an Real Estate Agent
The first step you should take if you’re selling your home during a divorce is to agree on a real estate agent with your former partner. That may sound daunting to many, but keep in mind that the agent’s priority will be to get the best price possible for both parties, not to take sides or pick favorites. If it’s more comfortable for you, the agent will agree to interview both partners separately.
So no matter how you feel about your divorce, remember that agreeing on an quality real estate agent will only make everyone more money in the
end. On top of that, selling a home under any circumstances is an intensely personal experience. A good agent will connect with you and give you reassurance throughout the process. Some qualities to look for in an agent as you proceed include:
- Experience. An experienced agent is more likely to have successfully managed selling homes during a divorce.
- Local Knowledge. Knowing the local market is key to getting you the most bang for your buck. Levelheadedness. The best Oregon real estate agents inspire confidence, and exude it themselves. A steady hand will ensure everyone’s comfort
level is taken care of.
- Avoid iBuyers. It might be the “easiest” option, but it’ll cost you big time. Large companies that give a cash offer on your home don’t have your bottom line as their priority. And with inventory at record low levels in Portland, taking the first cash offer out there is an unwise financial choice.
In particular, we recommend Stephen FitzMaurice, Principal Broker in Oregon with eXp Realty. Stephen has been licensed here since 2003 and has successfully overseen hundreds of divorce sale situations.
Agreeing on Improvements to Maximize Net Gains
Is your home in need of repairs? Even if it isn’t, it’s a good idea to get an independent appraisal done in order to nip any problems in the bud. Especially if you’re trying to streamline your process. If any issues arise, you’ll want to consult with your former partner about how to address them before getting too far into the listing process, when it could lose you both money due to a failed sale following the buyer’s inspection.
A good agent can help you out here too. Selling costs can get pretty high, so you may both be reluctant to invest even more money in repairs. But nearly every home that goes on the market will have something, however minor, flagged in an inspection. Your agent can help manage your expectations. At the end of the day, though, it is up to the sellers to make decisions on what improvements to make on the home.
You may also want to consider the costs of staging. Traditional staging in Portland is a cost, yes, but it could pay off in the long run. Or, opt for virtual staging to keep costs and hassle at a minimum.
Are the Proceeds Split 50/50?
Finally, the big question. But frankly, how the proceeds of a home sale happening during a divorce in Oregon really depend on the agreement made between the two individuals involved (or what the court orders, if it comes to that). It could be 50/50, it could be 80/20. The good news is that the title company is a neutral third party and will split the money based on whatever they are told to do, as long as all parties agree or in compliance with a court order. Again, this is one more step of the process that the folks helping you out will streamline.
These parties – the title company and the real estate agent – exist to make your transition as smooth as possible. You should always consult your divorce attorney to make sure you are protected. Know that the best real estate agents will always always be acting with both parties’ interests in mind. They have their client’s bottom line in mind. And when selling your home during a divorce, the best bottom line benefits everyone involved.