Start with what your agreement says
If you have a separation agreement or a court order, read the parts about the house first. It may already decide whether you sell, when you list, who lives there until closing and how the proceeds are divided.
If nothing is settled yet, an attorney can help you put those decisions in writing. A clear agreement now prevents arguments later, when a buyer is waiting.
Decisions you both need to make
Selling goes smoother when you agree on the basics before the listing goes live.
- The listing price, and the lowest offer you would both accept
- One agent you both trust to represent the sale
- Who handles showings, repairs and day-to-day questions
- How to split costs before closing, such as repairs and staging
- How to divide the proceeds after the loan is paid off
Keep the home and the loan in good shape
Until the sale closes, both owners usually remain responsible for the mortgage. A missed payment can show up on both credit reports, even if one person has moved out.
Keep taxes, insurance and utilities current, and keep the home ready for showings. A home that looks cared for tends to sell faster and closer to its price.
How the money is split at closing
At closing, the settlement agent pays off the mortgage and any other liens, then pays selling costs. What is left is the net proceeds.
The proceeds can be divided at closing by written instruction from both owners, or held in escrow until the court or your agreement decides. Ask your attorney which approach fits your case.
Selling vs. a buyout
If one of you wants to stay, that person can buy out the other. This is often done with a refinance that removes the other spouse from the loan and, in many cases, a cash-out to pay their share.
The person keeping the home needs to qualify alone, on their own income and credit. A CapCenter loan consultant can show you what a refinance could look like before you decide.
Taxes and legal questions
A home sale during a divorce can raise questions about capital gains, the home sale exclusion and how property transfers between spouses are treated. The rules depend on your situation, so talk with a tax professional.
Your attorney can explain how your state's divorce rules affect the house. This guide is general information, not legal advice.
