The biggest asset on the table for many Ohio couples who are ending their marriage is the family home. A common option is for one spouse to buy out the other one. But before this happens, it’s typically advised that they determine if this is financially feasible by treating the purchase as a new home buy instead of an ownership transfer.
People who are considering making an offer for this type of marital property are more likely to be in a better position to do so if they know how much equity they have in the home. This figure is determined by subtracting debt obligations from the home’s value, which can be provided by a neutral appraiser. A broker price opinion and a comparative market analysis based on results from sales of nearby properties are other possible valuation methods. Property tax assessments, however, may not be up to date.
How much one spouse owes the other one for the home is based, in part, on how marital assets are divided. In an equitable distribution state like Ohio, this split is done in a fair way that is not necessarily equal. Improvements and other home investments paid for by separate funds may also be subtracted from the home’s value if a separate contribution claim is made. The type of mortgage buyers need is usually based on what they can qualify for and whether or not they have other assets available to complete the purchase.
If a home-purchasing spouse is able to refinance without relying on spousal or child support income to qualify, a divorce attorney may recommend completing this process quickly. Doing what is referred to as a cash-out refinance prior to settlement could remove a common barrier that sometimes creates conflict.