How a house with no equity affects divorce?

While until death we part can certainly be a good feeling, marriages don't always work out that way. When divorcing, the division of financial assets can be a major source of stress and in no situation is it more evident than when selling your home in Georgia.

How is equity divided in a divorce? In an ideal situation, you simply sell the house and divide the equity equally. After all, if you're both in charge of the mortgage, you should both get some equity.

But maybe the market has bottomed out and you are underwater. Maybe your mortgage balance and the value of your home are the same. What happens to your home in the event of an unfair divorce?

Read on to find out more.

How to Determine Equity in Divorce at Home

Before taking any further action, you need to determine the value of your home. This means getting an evaluation.

Some states require an assessment by law, others do not. Either way, you need an appraisal to determine how much your home is worth.

If you're trying to reach a marital settlement, the court needs to know exactly how much each property is worth including your home.

In short, whether you're negotiating a deal or considering selling, you need accurate numbers to work with. If you have equity, how is it distributed in a divorce?

Equity is often halved. For example, if there is $50,000 in equity, each spouse will receive $25,000.

But the house may have been acquired before or after the marriage, as an inheritance or as a gift to a single spouse. Or maybe a spouse has contributed more money to the house. In such cases, couples may agree to an unequal split. Unfortunately, there is no simple calculator for allocating home equity. So, get ready to do some math.

Dealing with negative equity

Also known as being "underwater", negative equity means that your home is worth less than the balance you owe on your mortgage.

If the negative equity is minimal, you may be able to sell your home and pay the difference at closing. In such cases, it may make sense to increase the sale price while reducing the closing cost to make up the difference.

You might also consider a short sale, where the mortgage lender agrees to accept less than the full repayment amount, but has still paid the debt in full. Unfortunately, such agreements often last a long time, which is not ideal in a divorce.

Selling a house in case of divorce without equity

If your home isn't flooded but doesn't have any equity, the simplest solution might be to sell it and leave. This way your mortgage has been paid off and you don't have to find out who will pay what part of the debt.

Alternatively, a spouse can keep the property and refinance the mortgage (exclusively) in his name. In most cases, this approach tends to balance the division of assets and debts, since the spouse who takes over the dwelling receives an asset, but also assumes the associated debt.

What do you do after

In most cases, if your home has no equity, it makes sense to sell it and move on. But no matter how much (or how little) your home equity is, once you've decided to divorce and sell it, you want to do it fast.

Hisandhersinvestments takes care of selling your home quickly in Middle Georgia and easily and minimizes your stress. You don't even have to worry about listing your home, let alone paying commissions and fees. Hisandhersinvestments will buy your home as-is in Georgia, so you don't have to waste time and money on repairs and upgrades.

When you're getting divorced, the last thing you need is more stress. Let Hisandhersinvestments make things easier for you so you can move forward quickly and confidently.