When you and your spouse decide to part ways, you must figure out how to divide up your shared possessions in a manner that satisfies both of you. For many married couples, a home is the most valuable asset the two parties share. If this describes your situation, you must figure out how to split the amount of equity you have in it between you.
NerdWallet reports that most people navigating divorces choose to split home equity using one of three common methods.
1. Put the home up for sale and split the profits
If you are in a position where you could make a nice profit on your home, it may be easiest for everyone to sell it and split the amount you make on the sale between you. This gives you an opportunity to use the money made to make a fresh start somewhere else.
2. Buy out your ex, or have him or her buy you out
Not everyone is eager to vacate the family home after a divorce. If you want to stay there without your ex, or conversely, if he or she does, the person looking to stay may be able to refinance the existing mortgage to exclude the other party.
3. Take turns living in the home
In some cases, it may not serve either of you well to vacate the home at the time of your divorce. Maybe you are facing a bad real estate market, or maybe you have plans to move to another state in the coming months. If you have the money to do so, you may want to take turns living in the home until the time is right to sell it.