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- How divorce affects the process of selling your home
- Options for dividing your house when divorcing
- Resolving a joint mortgage when selling during divorce
- Should you renovate your property when selling due to divorce?
- What options are available for selling a property when divorcing?
- Selling whilst divorcing: some commonly asked questions
How divorce affects the process of selling your home
Divorce inevitably means that you and your partner are going your separate ways, and will no longer have joint assets. If you’ve bought a house together, whether or not with a joint mortgage, that property is perhaps the biggest asset that will need to be divided.
You’ll very likely need to rely on advice from your divorce solicitor to resolve how to divide your house or flat when you sell it. But before you speak to a legal professional you should be informed about the various options that you have available for selling.
Options for dividing your house when divorcing
Typically when couples who are joint homeowners are divorcing there are three main options they have available for selling their house or flat.
Selling the home outright and both partners leave
This can be a simple approach if you are both looking to leave your existing property and move on to new locations. Under this option you could potentially split the final sale net profit between you, and both use your share of the money to buy new homes. However, not every couple will have the financial means to be able to do this.
Retain the existing ownership and sell later
Under this approach you and your divorcing partner would wait until sometime in the future to sell. Reasons why you might want to take this approach include having young children living in the house – many couples who are homeowners and separating have waited until those children leave before trying to sell their property.
One partner buys the other partner out
A straightforward option is for one partner to pay the other partner for their share of the house, effectively buying them out. This situation will depend entirely on whether the partner who wants to have sole ownership of the property has the funds to buy the other partner out, which will not be the case with every divorce.
You might want to consider a “Mesher” order during divorce
Sometimes when couples are divorcing they obtain from a court what is known as a “Mesher” order, which effectively keeps the house or flat in their names until a specific event occurs. Common examples include one of the partners remarrying or even just reaching a set calendar date. When that event happens the house is sold, and the proceeds divided in terms with the provisions set out in the court decision that granted the Mesher order.
Resolving a joint mortgage when selling during divorce
Many couples that are homeowners have a joint mortgage, and this can cause some additional complications when they decide to divorce and sell their property.
Even after you and your partner divorce, the mortgage remains legally binding and you’ll both be liable for the repayments. If one partner refuses to pay then you risk falling behind in your repayments, which can damage your credit scores and even potentially lead to repossession.
One solution can be for one of the partners to take on the entire mortgage, thereby breaking all financial commitments between the couple. But this is only a wise move if the partner who will take on the whole mortgage knows they can make the repayments. Once the house is in the sole ownership of one partner they could then decide to try selling it.
Should you renovate your property when selling due to divorce?
It’s possible that you and your divorcing partner are the owners of what might be considered a problem property because of a feature that some buyers might consider to be a flaw. This can be something to do with the location, such as being nearby to unsightly power lines or mobile phone masts, or it can be a physical issue that needs fixing, like damp problems.
If that’s the case, then one important question to ask before seeking a buyer for the house or flat is whether you want to invest the resources to address whatever the problem might be.
This won’t be possible in some situations, particularly if the location of your property is the main factor that makes buyers lose interest in your home. But there are many situations where time and money can fix problems, such as installing noise insulation if your property is located on a busy road, or paying to have structural faults like subsidence or dry rot addressed.
A benefit of spending to fix a problem property is that it removes whatever some buyers might be concerned about, and could boost your home’s value. If you try to sell the home “as is” then it’s possible a buyer might calculate how much they’ll have to spend to address whatever issue exists if they own the property, and ask you to deduct this amount from the sale price. This in turn means you will likely make less profit due to selling your home at a reduced value.
You and your partner should write an honest budget for the sale of the property that specifies exactly how much money and time you could spend on any repair work. If doing the work will ensure that you’ll sell at a loss, try finding a buyer for the home in its existing state.
One complicating factor arises in cases where the funds for any renovation work would be drawn from a bank account that you jointly share with your divorcing partner, and they refuse to use the funds on any remediation projects. If this is your situation, then you may choose to forego trying to force use of those funds and instead seek a buyer for the home without fixing the problem. Otherwise you would most likely have to consider pursuing a court case against your partner to release the funds.
What options are available for selling a property when divorcing?
Typically, homeowners have the choice between selling the property on their own, using an estate agent, using a property auction, or using a quick buyer. Each method has its advantages, although some of the options also come with rather significant disadvantages. Consider the pros and cons of each method below before making a final decision on how to find a buyer.
You should consult with your divorcing partner on which approach to use for selling the home that you once shared. If you are not on speaking terms with them, you could try having this conversation via their solicitor. Regardless, consider how quickly you need to sell and how much profit you want to make, because this will help guide your eventual decision.
Selling the property on your own
This is perhaps the most stressful method unless you are already experienced with selling a home. You will have to spend money and time on advertising your property, as well as organising and hosting viewings for potential buyers to tour the inside and outside of the home. You’ll also have to handle any offers, and oversee the sale through to exchanging contracts. Unless you or a friend or relative knows how to do all of this, it will likely be too much stress.
There are many potential complications involved that it difficult to predict how long it will take to sell your home this way.
The only clear benefit of selling on your own is that you won’t have to pay a third party any commission for finding a buyer for your property. But it’s possible to get a no-fee sale with much less hassle by using a quick home buying company like LDN Properties, because they never charge any fees and they can complete the entire purchasing process in just a few weeks.
Using an estate agent to sell your home
Some people like to use estate agents when selling their properties because it can be a relatively stress-free choice. That’s because the estate agent takes on the responsibility for all of the time-consuming, expensive and complicated tasks of selling your home – everything from producing the listing through to advertising it and organising viewings, and from discussing offers with buyers through to ensuring that a sale happens and contracts are exchanged.
Yet even with the estate agent doing the bulk of the work, there can be a few disadvantages for buyers. If there is a lot of interest in your home, you can expect there to be many viewings where people that might buy the property get to extensively tour the interior and exterior. Viewings alone can take up too much time and raise sufficient privacy concerns from some homeowners that it’s enough for them to no longer consider using an estate agent.
Another negative of using an estate agent is that you’ll have to pay them commission in exchange for the work that they do in finding a buyer. Subtracting this commission from the sale proceeds will reduce your share of them, and meant that you could make less profit compared to other selling options.
Beware that some estate agents might give you a sale price quote for your home that is quite high, even if they know but don’t tell you that it will only find a buyer at a lower price. They’re trying to secure your business and the commission that comes with it. Prevent this by getting free quotes from many estate agents, and look at sale prices for homes like yours on property websites, and then calculate the average of all those values for a more accurate price.
Selling via this method can take several months and, in certain scenarios, more than a full year before you get a genuine offer. This can be problematic if your top priority when selling is to find a buyer as swiftly as possible, meaning within weeks rather than months or longer.
Using a property auction for your home
When selling this way, it’s vital that you price your property right and choose a reserve price – the lowest amount at which you are willing to sell your home – that guarantees you’ll still make a profit on the sale even after subtracting whatever commission and other fees the auctioneer charges.
It’s possible you might not receive any auction bids on your home, which means it doesn’t sell, and you’ll have to start over with trying to find a buyer. This will naturally add significantly delay to your timeline for selling. Your aim is to have several people wanting to buy your home, so that they place ever-increasing bids that results in you making a good profit on the property.
Expect to wait at least a month between when you first list your home for sale and when the auction occurs. And if your property does sell, the buyer has an average of 28 days to finish all of their required steps to complete the purchase of your property. Some auctioneers might give the buyer more or less time, so always check with specific companies. All together it will generally take at least a couple of months to sell your home when using an auctioneer.
Auctioneers will also charge you commission that will have to be deducted from the sale proceeds, in turn reducing your final profit. Some auctioneers might let you transfer the obligation to pay certain fees on to the winning high bidder, so it’s always worth asking businesses about this.
Using a quick buyer to sell your property
Another method of selling that has several advantages is contacting a fast home buyer such as LDN Properties. Based in London and launched in 2003, this company gives homeowners a no-hassle, streamlined and stress-free way to receive speedy and competitive offers for selling their flats or houses. Quick buyers can consider purchasing almost any type, age, condition, size or shape of freehold or leasehold home, as well as plots of land and other property.
One of the major perks of using a quick buyer is that they often have the financial ability to buy your house or flat immediately, so there aren’t any months-long delays until they get approval for a mortgage to cover the cost of purchasing the property. The result is that fast buyers can typically complete all of the steps of buying your home within just a few short weeks.
Another top advantage of selling via this method is that the legitimate speedy home buying companies will never make homeowners pay any commission, fees or other charges. Therefore, you can count on receiving the full proceeds from the sale, which will maximise your profit.
Quick home buyers are also experienced with purchasing properties in almost every type of personal situation imaginable, including homeowners divorcing, dealing with unwanted retirement properties, adjusting to the birth of a child, moving overseas, and much more. That means the fact you’re divorcing won’t likely create any barriers at all for selling your home this way.
And if you don’t like the idea of many prospective buyers coming to your flat or house on viewings, using a fast buyer will remove this problem entirely. The only viewing will be when one of the company representatives comes to the property to inspect the inside and outside, which should help to reduce your stress.
Selling whilst divorcing: some commonly asked questions
Divorce is a stressful situation, and when it’s tied to selling a house it can be even more overwhelming. Here are some common questions we hear about that combination:
Yes. If you need a fast sale you could speak to a trustworthy property buyer, who’ll pay you in cash and not charge any fees to buy your home on a speedy schedule. Reputable property buying companies should be members of The Property Ombudsman (TPO), so check with the TPO for a list of its members.
Yes. If you’re divorcing you have a number of options for how you proceed with a sale, including the possibility of buying your partner out and taking over complete ownership of the property. If you have the financial ability to do this, you can then sell the house and receive all of the proceeds if you are the only homeowner.
Yes. Even if you’re divorcing there is no urgent deadline for you to sell if you’d rather wait until a later date. You can even obtain a court order known as a Mesher order that will specify that the house you jointly own cannot be sold until a certain date or events occurs, such as the youngest of your children leaving the home.
Potentially, at least in the short term. Depending on your specific situation, both divorcing partners are likely to have a stake in the property and if one of them refuses to sell the home, it can delay the process significantly. You should always aim to reach an agreement on selling, because the ultimate alternative is lengthy and costly litigation in order to force a sale.
Only if you have previous experience with selling properties, or have someone with that knowledge who is willing to help you. Otherwise, it will likely be stressful time as you’ll have to handle every aspect of the sale from the initial listing through to hosting the viewings and exchanging contracts, and you’ll have to pay for the many expenses that are involved.
