The family home is, for many people, their most valuable asset. It can also have a functional importance as the place children are raised, as well as having emotional and sentimental value. As a result of all these considerations, splitting the home in a divorce can be exceptionally difficult.

The initial question is whether the home should be divided at all. In New Jersey, only marital property is subject to equitable distribution in a divorce. If a home was purchased or otherwise acquired during the marriage, it likely will be considered marital property, even if only one spouse is on the title. On the other hand, a house would be considered separate property if one spouse had bought it and paid it off before the marriage. The home might also have a mixed status. If its value rose during the marriage or the other spouse contributed to its upkeep or improvement, the home could be considered marital property to that extent.

According to New Jersey’s equitable distribution system, each spouse gets what is considered a fair amount of marital assets based on factors like each spouse’s income, how long they were married and what contributions each of them made to the household and to the marriage in general.

In the case of equitable distribution of the family home, there are three basic options available:

• Sell the home and split the proceeds — This can be the quickest and cleanest option for many couples, as it allows them to each take their share in full.
• One spouse buys out the other — A spouse who wants to stay in the house could buy out the other’s interest, perhaps by giving up other marital assets to balance things out or by refinancing it and giving some of the proceeds to the other spouse.
• Co-ownership — There may be reasons why the couple chooses to maintain the status quo and own the home together for a while. This can be a good option if the couple has young children who they want to stay in the same home and the same school. Or, sale of the home may not be profitable in the current real estate market. If the house remains co-owned, one spouse needs to move out, but a financial concession can be granted in return.

Divorcing spouses are usually best served by resolving the home ownership issue outside of court. When thinking about how the home will be divided, don’t forget that ongoing costs, such as property taxes, insurance, utilities and mortgage payments, can require making adjustments in the award. Your divorce attorney can advise you on the best method of resolving the home ownership issue in your situation.  

At the Martone Law Group, LLC in Haddon Heights, I help clients in Burlington and Camden counties with all issues related to divorce and property division. Please call my office at 856-432-4587 or contact me online to schedule a free initial consultation.