Generally, the largest asset in a marriage is the marital residence. Movies and television shows will have you believe that someone in the divorce always “gets the house.” This is not necessarily true, and it is not always that simple. A court may decide to allow the residential parent to remain in the home with the children for a select time period, usually until the youngest child graduates high school. However, that still leaves a financial burden, as most homes have mortgages, real estate taxes, utilities, etc. to consider.
The Court will also then provide for a determination on who is to pay those expenses. For example, the residential parent customarily receives child support, which is intended to provide for housing, clothing and grocery expenses for the children. If the residential parent desires to remain in the home and is only receiving child support, they have to ensure for themselves that they can financially afford to continue to carry the house.
Now, let’s say you didn’t “get the house,” what’s next? Do you get an apartment? Buy a new house? A condo, a coop, an RV? Your first step is to work out your finances. Are you paying child support? Are you paying maintenance? Did you receive a cash sum as a part of an equitable distribution award from your
divorce? Many divorcees want to buy something, they want something concrete and stable for their children. They want a home so that their children feel like they have a place of their own, and not just a place they are visiting. These things are completely natural and understandable.
It is important to know that in the current real estate market homes are selling fast and bidding wars are almost guaranteed, so if your intent is to purchase something, you need to get your ducks in a row. Be prepared with a mortgage prequalification, know your budget, and stick to it. If you plan on using cash,
have it in hand before you sign a contract to purchase a home. Do not sign a contract, without a financing contingency, if you are going to be waiting on a cash distribution from a 401k or other similar type account. Depending on the terms of your contract, and current COVID delays just about everywhere, you may not have time to wait for something to clear. To ensure you do not lose out on your home and you don’t lose your down payment, have the cash before you buy. And most importantly, have a real estate attorney at the ready for when you are ready to proceed or need questions answered along the way.