Who Gets The House In a Divorce?
The largest asset in most marriages is the family home, but what can happen to it in a divorce?
So when it comes to getting divorced, it’s perhaps no wonder that deciding how to divide up the equity in a shared property is often the biggest point of contention.
This will sometimes be a case of who gets to remain living in the former matrimonial home and who needs to move out, so emotions can run high.
How can the house be divided in a divorce?
Separating couples will often put a lot of effort into negotiating how to deal with their former shared matrimonial home, and this may involve mediation. There are many different options for dividing the property, including:
- Selling up – the divorcing couple can put the house on the market and divide up the proceeds. This is often the most straightforward option and can provide for a clean break order. Any money from the sale can be used for both parties to put down a deposit on new properties.
- Buying out – another common method of dealing with a shared property is for one former spouse to purchase the remaining equity from their former partner. This also provides a clean break but it is only possible where one party has sufficient financial resources – either to buy the equity themselves or to increase their mortgage.
- Maintenance – if there are young children from the marriage, the mother will sometimes remain in the property, and the father will move out and carry on contributing to the mortgage repayments as part of a maintenance agreement.
- Settlement – if there is no mortgage on the property, one ex-spouse could simply leave the house to their former partner as part of a financial settlement, possibly as part of pension offsetting.
If the divorcing couple fails to reach an agreement with a consent order, the court may need to impose a financial order.
Do I have a right to stay in my home during divorce proceedings?
While the divorce process is still ongoing, spouses have ‘home rights’ in their shared matrimonial home. In effect, even if the property is owned by just the husband or wife, their spouse retains a right to live in the property until the divorce, annulment or dissolution has been finalised and a court settlement agreed.
However, it is vital that home rights are registered with the Land Registry. For more information on home rights, see our Matrimonial Home Rights Application Service.
If the divorcing couple are joint legal owners of the property, the situation is more straightforward: both parties have a right of entry and occupation until a relevant consent or financial order has been approved by the court.
There are exceptions to this rule in cases of alleged domestic violence etc.
What happens to the house if we have children?
The divorce law in England & Wales prioritises the welfare of children. This means the safety of children always comes first along with minimising the disruption caused.
Often this means that the main parental carer and children remain in the family home. However, it is also important to mention that this is only if this option is feasible.
If the primary caregiver chooses to stay in the family home its essential that they can afford to live there, in some cases the spouse that has moved out chooses to continue to help pay the mortgage but this can not always be possible due to them having to pay for an additional place to live.
How does the court decide who to give the house to in a divorce?
As with all matters related to divorce, the circumstances of the marriage and both parties will need to be assessed individually before the court can make a decision on how to divide up a matrimonial home – including whether one of the former spouses can remain living in the property.
In all cases, there is an overriding principle of fairness, and the initial starting point will be a 50:50 split.
The primary concern of the court will be to protect the welfare of any children under the age of 18. They will then look at other factors set out by section 25 of the Matrimonial Causes Act 1973, including:
- the income, earning capacity, property and other financial resources which each of the parties to the marriage has or is likely to have in the foreseeable future;
- the financial needs, obligations and responsibilities which each of the parties to the marriage has or is likely to have in the foreseeable future;
- the standard of living enjoyed by the family before the breakdown of the marriage; and
- the age of each party to the marriage and the duration of the marriage.
When you purchased the property your solicitor should have asked you how you wanted to own the property and explain the difference between Joint Tenancy and Tenancies in Common to you.
For example, if there are Title Deeds pertaining to the property it may have both names on the property stating that it is owned jointly, but your Beneficial Interest in the property might be held in equal or unequal shares.
If you hold the property jointly this does not automatically mean that on sale the proceeds it will be divided equally. The court may have to consider the Beneficial Interest in the property this may be a 60/40 split or 70/30.
If you hold property as joint tenants and your spouse dies their share of the property will automatically pass to you. This will happen even if you’re ex-spouse has left a will expressing a wish for the share to go to someone else.
If you do not want your share to go automatically to your spouse then you should consider asking a solicitor to “sever” the Joint Tenancy. This can be done by serving a written notice on your partner that the Joint Tenancy is severed.
Both parties will then hold the property as”Tenants in Common” which means It is still in joint shares, but if you die your share will go to whomever you want it to pass to and you can make provisions for this in your will.
Upon divorce, you may decide to sell and split the proceeds, transfer your share to your spouse or even or buy out their share. You could also decide that you do not want to sell the property until certain triggers have been reached such as until the youngest child reaches 18 or finishes full-time education.
You also may need help from your spouse to pay the mortgage which the court can order if they deem this necessary.
This can be written in a consent order if you are both in agreement as to what is to happen to the home when you divorce. This means both of you have to stick to the agreement as it is then legally binding.
As the former matrimonial home is one of the largest assets most couples own it is good if you can sit down and come to a mutual agreement and decide how to separate your home.
What happens with joint mortgages?
Married couples with joint mortgages are jointly and severally liable for mortgage repayments; this essentially means that if either spouse fails to pay their share their partner can be held liable.
As such, divorcing couples will often try and move the mortgage into one name as part of the overall financial settlement, to prevent complications arising in future.
What happens if the family home is owned by just one spouse?
If your marital home is only in one spouse’s name it’s essential the other spouse registers home rights with the Land Registry. This means that they register their rights in the property and stops the property from being sold, transferred or mortgaged without their knowledge.
it’s important to know that this is only a temporary solution until the financial consent order is in place and a permanent solution has been found. It will also be obsolete after the decree absolute has been issued so you must register before your divorce is finalised.
What should I do when selling a house because of divorce?
One of the first things to do when deciding to sell up as a result of marriage breakdown is to get the property valued by an estate agent or surveyor. This valuation will be extremely important in terms of the overall financial settlement.
If you have a joint mortgage, inform your mortgage lender about the situation straight away; any failure to meet mortgage payments can damage credit scores of both parties (eg making new mortgage applications more difficult) and can even lead to the house being repossessed.
Should you sell your house before or after you have filed for divorce?
Whether a divorcing couple decides to sell up before or after divorce will depend to some extent upon their respective financial situations.
If both have their own independent means and savings, there may be less of a rush to sell up – especially if they are happy to carry on living together during divorce proceedings, or if alternative living arrangements can be made.
But if money is tight, it may be helpful to put the marital home on the market at the earliest opportunity.
The overall process of separation can be very expensive and having access to proceeds from a house sale may be critical in terms of both parties being able to meet their financial responsibilities.
On the other hand, if any substantial repairs or alterations are required before the house can be put up for sale, this can lead to disputes as to who is responsible for paying for any work. In this case, it may be better to first reach a divorce settlement which takes this issue into account.