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Who Gets the House in Divorce Proceedings?

On Behalf of | Jan 3, 2022 | Divorce

One of the most contentious issues in any Tennessee divorce involves the distribution of marital assets. For most couples who own their own home, the home is probably the most valuable asset. Thus, it is often the focus of much litigation and resultant stress. However, unless a home is entirely paid off, the spouse awarded the home must continue to pay the mortgage, insurance, property tax, and other expenses. Thus, it is important to understand not only how Tennessee courts decide who gets the house in a divorce but also the other considerations that can impact life after divorce.

How Do Tennessee Courts Decide Who Gets the Property After a Divorce?

When it comes to dividing a couple’s assets after a divorce, Tennessee is an “equitable distribution” state. This means that courts will not necessarily divide a couple’s assets down the middle. Under Tennessee Code Annotated § 36-4-121, a court must “equitably divide, distribute or assign the marital property between the parties without regard to marital fault in proportions as the court deems just.”

Equitable Distribution Factors in Tennessee

In determining what is “just,” courts consider the following factors:

  • The length of the marriage;
  • The age of the parties;
  • The health of the parties;
  • The employability of the parties;
  • The financial and non-financial contribution of each spouse;
  • The value of each spouse’s separate property;
  • The value of the assets each spouse brought into the marriage;
  • The tax consequences facing each spouse; and
  • The amount of Social Security benefits available to each spouse.

Additionally, courts can consider any other factor “necessary to consider the equities between the parties.” However, as noted above, courts will not consider whether a spouse’s actions led to the divorce when engaging in the equitable distribution analysis.

Of course, divorcing spouses are free to come up with an agreement regarding what to do with a home. Generally speaking, courts approve agreements between spouses, provided they are fair and do not adversely impact the lives of the couple’s children.

Options for Divorcing Couples

While the equitable distribution factors help courts determine the assets that each spouse receives after a divorce is final, there are other considerations when dealing with an asset as large as a home. Most couples have at least one mortgage on their primary residence, requiring what is often a significant monthly payment. In addition, there are other expenses related to home-ownership, such as property taxes, utilities, and homeowner’s insurance.

Courts do not want to award a home to a spouse who cannot afford to cover these expenses, especially when children are involved. This means that the court overseeing the divorce proceeding will not necessarily award the home to either spouse. Generally, there are four options divorcing couples have when it comes to who will get the house.

Sell the House

Perhaps the easiest way to deal with a primary residence during a divorce is to sell the house. Selling the home not only provides the couple with liquid assets that are much easier to divide but also results in a clean break. However, homes often hold sentimental value, and it is common for at least one spouse to want to remain in the home after the divorce is final.

One Spouse Buys the Other Out

If one spouse is financially able to purchase the other spouse’s interest in the home, they can buy out their spouse. While this enables one spouse to keep the home, it also adds a level of complexity to the divorce in that the home must be appraised to determine its fair market value. Additionally, this can raise concerns about a spouse’s ongoing ability to cover all the expenses related to home-ownership.

Refinance the Home After the Divorce

Another option involves one spouse refinancing the home after the divorce process is final. Again, this option is not available in every situation, as the spouse who intends on refinancing the home must be able to qualify for the mortgage on their own.

Keep the Status Quo

Tennessee law does not prohibit divorcing spouses from continuing to jointly own the home. Thus, doing nothing and keeping the home titled as it was during the marriage is technically an option. However, this approach is only appropriate where the divorcing spouses can maintain a positive relationship, as they will continue to own a very valuable asset together.

What to Consider When Determining What to Do with a Home During a Divorce

One of the most difficult financial decisions a couple must make during a divorce is deciding what to do with their home. However, by answering the following questions, spouses can make an informed decision.

  • Can you afford to continue living in the home based on your income alone?
  • Is your relationship with your spouse such that you can own a home together post-divorce?
  • Will moving or selling the home uproot your children?
  • Would selling the home come at an emotional cost to you or your children?
  • Are property values expected to increase or decrease significantly in the future?
  • Is your income subject to change unexpectedly?
  • Does the home require any deferred maintenance?

Certainly, the decision to sell a home in a divorce is not an easy one. However, keeping a home only to run into financial difficulty down the road is not a better option. Those who anticipate divorce in the near future and are concerned about the future of their primary residence should reach out to an experienced Tennessee divorce lawyer for immediate assistance.

Contact the Dedicated Attorneys at Batson Nolan, PLC.

If you believe that divorce is on the horizon and have questions about what to do with your home, reach out to the experienced lawyers at Batson Nolan PLC. At Batson Nolan PLC., we have been helping clients confront the various legal issues they face since 1860. As one of Tennessee’s oldest and most respected law firms, we possess unrivaled experience and a unique depth of knowledge that enables our attorneys to offer clients unparalleled representation. We handle all types of family legal issues, including divorce, child custody, mediation services, and many others. To learn more and to schedule a free consultation with one of our lawyers, give us a call. You can also connect with our attorneys through our online contact form.