If you and your spouse own a home and are getting divorced, you are probably beginning to consider the realities of the division of assets. It can be overwhelming when you realize the extent of the decisions you need to make. A major asset that has to be dealt with during a divorce is a home and therefore a mortgage.
If you need legal advice or representation regarding divorce or division of assets, a Sparta property distribution attorney can help.
Is a Mortgage Marital Property?
Figuring out what assets are marital property versus separate property should be the first step in dividing assets. Family homes are typically considered marital property. If you and your spouse bought or built a home during your marriage, the house is marital property even if only one of your names is listed as the owner.
A house is rarely separate property unless it was owned by one spouse before marriage or it was received by one spouse as a gift or inheritance. However, if the other spouse contributed to the home such as paying for maintenance or doing chores, it may be considered joint property by a court.
Is New Jersey an Equitable Distribution State?
Yes, NJ is an equitable distribution state. This means that during a divorce or separation, assets are split between the two spouses in a way that is fair but not necessarily equal. One spouse may receive more money or assets of a higher value than the other spouse for a variety of reasons. A marriage is a partnership, and in some instances, one spouse will turn down career opportunities for the good of their family, quit their job to raise children, or delay their education. These sacrifices could result in a lower earning potential or income, so receiving a higher percentage of assets during distribution can make up for a wealth disparity.
How Can a Mortgage Be Split Up During Divorce?
There are generally three options when a couple that jointly owns a house gets divorced. They can either sell the house, one spouse can buy out the other, or they can remain joint owners.
Selling the house is the most common solution that couples choose. Whatever proceeds accrue from the sale can be split between the couple.
If one spouse would like to remain in the house they can buy out the other for their portion of the value. The mortgage may be refinanced during this process but the spouse who remains in the house will become the sole mortgage holder.
If you have children who go to school nearby, it may be in their best interest to refrain from selling the house just yet. You can figure out a situation that is agreeable to both parties. One spouse may move out or you may alternate staying in the home. In your divorce papers, you can agree to sell the house and distribute the money at a later date.
