Is It Better to Sell Your House Before or After a Divorce?

Selling a property during a divorce is complicated. This is especially when you are selling the home due to the divorce. The most appropriate time to sell a home due to separation is before your divorce even begins. There are multiple factors that must be considered when selling your home, including tax implications, real estate market conditions, and more.

It happens all too often: In the process of divorce, one spouse is ready to sell the marital or family home but the other isn’t—and so the latter decides to obstruct the sale. If you find yourself caught in this situation, or you want to avoid such a scenario in the future, it’s important to understand the potential issues involved and put safeguards into place to work toward a positive outcome. (1)

When you know you need to sell your house, selling it as soon as possible is usually the smart choice, if you are ready to go this route contact us, we are Kansas City home buyers. However, there are a few drawbacks you will encounter when you sell your house after the divorce. You should never let the buyers know why you are selling your house, as they could take advantage of your situation. Here are some of the benefits and demerits you can experience when you sell your house before the divorce or after it’s finalized. 

Cash in On the Home Equity

When you sell your house before a divorce, you can cash in on the home equity. Divorce signals the end of a marriage but also the beginning of a new, single life. In most marital property laws, you may be entitled to half of your home’s value. However, if there is a decent amount of equity in the house, your share will fund a future of your own.

You can use the money to relocate to a new state or cover the costs of a rental if you are not ready to commit to another property. If you are thinking: now is the perfect time to sell my house fast Kansas City, give us a call, we will make you a fair cash offer for your house.

It is Easier to Let Go

When it comes to a divorce, some of the emotional ties to your home can be painful. Some experts suggest that keeping the house can create a sense of normalcy for kids during a divorce. However, other experts suggest that it is easier for kids to accept a new normal in a new home. Plus, it’s facile to forgive and develop a cooperative relationship with your ex-partner if you are not living in a house where you are constantly reminded about your unhappy marriage. 

Having a healthy relationship with your ex is always emotionally healthier for the kids.

Avoid the Capital Gains Tax

Being married is always a benefit when it comes to the IRS. One of the biggest tax advantages you get as a married couple is the capital gains tax exemption. When you sell a property as a married couple, you can exclude up to half a million dollars of the home equity from the capital gains tax. This means that you and your spouse will avoid paying taxes on your share of the home’s value if you sell your property during the divorce.

Drawbacks of Selling Before a Divorce

Selling a house before a divorce requires both of you to get along. If this doesn’t happen, it can drag on and cost both parties a lot of time and money. Divorcing spouses who are fighting with each other often make decisions fueled by raw emotions and anger. When there’s a lack of cooperation during the home sale, you will find yourself opposing decisions that should be common sense. 

In the end, you will end up fighting over who gets to keep what in the house. In addition, the home sale process can delay the divorce. You will need to find an agent, set the list price, and prep the property. Since you have to make these decisions with your spouse, each choice may become a battle that will delay the home sale. 

What’re more, unavoidable delays can be totally out of your control. When the home sale returns are part of the divorce settlement, you will have to wait for the deal to close so you can finalize the divorce.