Co-Owning The Family Home After Divorce: A Short Guide

By Lois G. Schwartz | June 21, 2019

When a couple is considering property division upon a divorce, the most important asset is often the family home. Sometimes one party is awarded the house in divorce proceedings, sometimes one spouse negotiates a buyout of the other spouse’s interest, either for immediate cash value or a structured payment plan. Alternatively, on occasion spouses will opt to continue to co-own the house, most often in cases where there are school-age children in the family, but there are other reasons as well. Here are the advantages and disadvantages to co-owning a house after a divorce, and what issues to consider.

What Are The Pros Of Co-Ownership?

One of the most obvious advantages to co-owning a house after a divorce is the kids. If the parent with majority custody cannot afford to buy out the other spouse, the two exes can negotiate a deal where the kids can stay in the same house, providing a necessary sense of continuity and security during a rough time for the family. Then the spouses can have time to negotiate a future possible buyout.

What Are The Cons Of Co-Ownership?

While there are pros to co-owning the family home, there are several complications that can make the situation an untenable one. There are a number of financial and legal responsibilities that go with owning property, and it can be difficult for ex spouses to deal with these after a divorce is final.

If your home has a mortgage and both your names are on it, you are both then legally responsible for the full amount of that mortgage. Counting on an ex-spouse to pay their share of the mortgage can be tricky, and if one party doesn’t follow through, both of the individual’s credit is negatively affected. Negotiating a buyout or awarding the house to one party are ways to simplify this.

Co-owning also means, that for better or worse, you are still in a contractual relationship with your ex-spouse. You must cooperate when it comes to who pays what portion of the mortgage, who pays for upkeep and household repairs, and who can take the mortgage interest deduction. If you are on good terms with your spouse this may be easily negotiated, but if circumstances change this can be used as a tool to financially harm one spouse or the other.

In terms of taxes, if you co-own a house for a lengthy period of time after the divorce is final you lose the benefit of the tax breaks between spouses after a divorce. Any written agreed transfers within a year after the divorce becomes final are deductible, but if you wait too much longer you lose that benefit.

Seek Legal Help!

There are so many more considerations for couples if they are considering this option. Who gets their share of the house if one spouse dies? What if one spouse falls on hard times and has to file for bankruptcy? Their portion of the house could be subject to forced sale. If you are considering this option, seek the help of an experienced family law attorney to help you cover all the bases and draw up all the legal paperwork necessary to protect your rights. Divorces can get messy quickly. Don’t take on the process alone.

Contact A Family Law Attorney for a Consultation About Your Divorce in New Jersey Today!

If you are thinking about filing for divorce, or if you have already started the divorce process and are dealing with another matter such as child custody, child support, or relocation of a child out of state, you need to speak with a qualified attorney. Lois Garber Schwartz is an experienced family law attorney and represents clients throughout South New Jersey. We understand how challenging this time can be for you, which is why we will fight hard to protect your interests, and the interests of your loved ones, throughout the legal process. Call us at 856-375-8989 or fill out our confidential contact form to schedule a consultation. Our office is conveniently located at 1040 Kings Highway North, Suite 202, Cherry Hill, NJ 08034.

The articles on this blog are for informative purposes only and are no substitute for legal advice or an attorney-client relationship. If you are seeking legal advice, please contact our law firm directly.

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    Lois Garber Schwartz

    1040 Kings Highway N., Suite 202

    Cherry Hill, NJ 08034


    Phone: 856-375-8989

    Fax: 856-482-0343