Splitting Up Your House in a Divorce? Don’t forget about Home Appraisal
A relationship ending in divorce is every couple’s worst nightmare. Aside from the emotional trauma, there’s the practical mess. How will you untangle the deeply intertwined life you built together? It’s one thing to divvy up the furniture, and quite another to divide your largest financial asset: the house.
It’s common for married couples to buy property together or for newlyweds to add each other’s names to property titles. In the event of a divorce, this makes it much more likely that disagreements will occur when it comes to dividing assets and creating an amicable separation.
Unfortunately, taking a saw to split it down the middle won’t do you any favors. There’s only one way to give each spouse their fair share—and that’s by determining its worth.
This isn’t a case where you want to hash out a number and shake on it, leaving your ex-spouse feeling bitter and ready to take you to court.
Top real estate attorneys and agents who specialize in helping divorcing couples will advise you get the house appraised by a licensed appraiser for an iron-clad valuation.
Does your spouse plan to keep the home and you’ll need to collect your half of the equity? Can’t agree on a list price to save your life and it’s got you fuming?
The home appraisal, a third-party, unbiased estimate of your home’s true value, can be the best solution when emotions are flying high.
Outcomes for “Matrimonial Home” in case of a Divorce & How a property appraisal can help:
1. Buyout by one of the partners: A property appraisal is especially useful in the case of a buyout. Generally, buyouts occur as follows:
Spouses agree on the fair value of the property or properties in question
The spouse that will be the full owner of the property pays out half of the agreed upon value to the spouse being bought out, either with a one-time payment or on a legally agreed upon payment plan
If there are mortgage payments still being made, arrangements can also be made to separate the spouse being bought out from their mortgage obligations
The problem here is that without a property appraisal, it’s rare for two spouses to agree completely on the value of the property. That’s where we come in. In the midst of a sensitive divorce process, you don’t want to deal with drawn-out litigation over disagreements about the market value of a matrimonial home for example. We bring wealth of knowledge and expertise in this area and can help to provide current market value of your property that satisfies both of your needs for accuracy and satisfaction.
2. Sale of your matrimonial home? A certified appraisal can help to price it too: If you decide to put your home on the market, you’ll need to agree as a divorcing couple on a list price.
During the course of a normal home sale, your real estate agent performs a comparative market analysis, or CMA, which looks at comparable home sales in your area to provide an estimated value for your home.
Although the CMA is a widely used and highly respected tool for pricing homes, it still might leave too much room for disagreement during a contentious divorce.
In that case, a home appraisal comes into play prior to listing the home.
Appraisers go through extensive and rigorous training and education to develop the expertise required to assess the value of a home and must get a professional designation in Canada like Appraisal Institute of Canada (AIC) and adhere to their strict regulations and guidelines. And most importantly they are not representing either spouse but can act as a neutral third party in heightened situations.
Using an upfront appraisal to price your home is not to be confused with the appraisal that happens on behalf of the buyer of the home after a house goes under contract.
To be clear, the original appraisal paid for by the sellers before listing does not negate the need for the buyer’s appraisal later in the transaction. The lender will still require a separate appraisal (covered by the buyers) to make sure they aren’t financing a loan for more than the home is worth.
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