Selling a home during a divorce: What clients need to know

Industry Observer with LendingTree

Most couples assume their marriage will last forever, but data shows that divorce is an inevitable reality for many. The most recent statistics from the Centers for Disease Control and Prevention show that in 2018, there were 782,038 divorces in the U.S., compared to 2.1 million marriages that same year.

Navigating the home selling and buying process can be confusing and stressful for any homeowner, but for those going through a divorce, an additional layer of complexity and urgency is added to the mix. This is an opportunity for real estate professionals to help alleviate some of that stress and guide their clients through this difficult time.

Selling vs. keeping the property

One of the most significant decisions divorcing couples face is whether to sell their home or have one spouse remain in it. Several factors contribute to this decision, including the expected financial situation of each spouse, emotional attachment to the home and whether or not kids are involved. In some cases, one spouse may have plans to relocate. An estimated 17% to 25% of divorcees with custody of their children move out of the area within two years of the divorce. Generally, clients will consider one of these paths:

  • Sell the home.
  • One spouse keeps the home.
  • Keep the home with a future sale in mind.
  • Continue co-owning the home.


What homeowners must consider

Undoubtedly, emotions may run high as couples go through the selling or buying process during a divorce. Here are some other things that will impact their decisions.



If one spouse remains in the home or is planning to make a new purchase, will they be able to afford the home on their own? Many people overestimate what is doable after the divorce. Help your clients be realistic about what they can afford.


Community property vs. equitable distribution

If the divorce will be handled in court, state law will impact their decisions. Most states are common law and distribute marital assets fairly and equitably between the spouses. This doesn’t mean a 50/50 split, though. For example, if one spouse earned significantly more than the other during their marriage, then they may be assigned a higher percentage of the assets. However, in community property states, property acquired during the marriage is shared evenly. There are nine community property states:

  • Arizona
  • California
  • Idaho
  • Louisiana
  • Nevada
  • New Mexico
  • Texas
  • Washington
  • Wisconsin


Tax implications

Divorcing couples will also need to consider the tax implications of selling their home. Be sure they are in contact with a financial professional to help them discuss how to manage their taxes.


Shortened selling timeline

In a divorce, timing will likely play a significant factor. Whether it’s for financial reasons, one spouse is relocating or the couple is just eager to move forward with the next chapter of their lives, they’re probably looking to sell the home as quickly as possible. This may mean putting the home on the market in an off-season, selling in a less-than-stellar market or accepting a low offer. Be sure both spouses understand the average DOM in the current market. Additionally, make sure they agree on the following:

  • List price.
  • The lowest offer they will accept.
  • Deadline to sell.
  • Expenses they are willing to incur during the selling process (e.g., cleaning, repairs, staging, etc.)


Showing the home may be more difficult

Coordinating two different schedules of a divorcing couple may impact the process of showing the home. Additionally, if one or both spouses have moved out or are in the process of moving out, it may be more challenging to show an empty or almost-empty home. Discuss the possibility of staging the home and be clear on when it will be available for showings.


Lack of communication

Divorcing couples may not be on the best of terms and therefore may not prioritize communicating with each other during the selling process. This may mean a little extra work for you, the real estate agent. Whether it’s open houses, showings or negotiating offers, err on the side of caution and duplicate all your communication to each spouse so both parties stay informed. You want to avoid setbacks during the selling or buying process because one spouse forgot to pass along information.


Dealing with an unwilling spouse

It is not uncommon for one spouse to be reluctant about selling, even if their financial situation leaves them no other options. You may want to consider carefully whether or not to proceed with such clients. If one spouse is hesitant to sell, you may encounter a nightmare situation where they refuse to cooperate during the process or hold out on discussing offers. Consider saving yourself the headache by avoiding this scenario altogether.


This entry hasn't been re-blogged:

Re-Blogged By Re-Blogged At
Home Selling

Post a Comment
Spam prevention
Spam prevention
Show All Comments
Roy Kelley
Realty Group Referrals - Gaithersburg, MD

This is good information to share. Have a very productive month.

Mar 16, 2020 11:43 AM #1
Post a Comment
Spam prevention
Show All Comments

What's the reason you're reporting this blog entry?

Are you sure you want to report this blog entry as spam?


ValuePenguin By LendingTree

Ask me a question
Spam prevention