If you are considering filing for divorce in Michigan, you are probably thinking about who will get to keep which assets acquired during the marriage. For Michigan married couples who own a home together, the house can present its own set of significant challenges. When there are still young children from the marriage living at home, one of the parties may want to keep the family home in order to continue raising the children there. At the same time, even when the children are grown and living on their own, one of the parties may really feel as though the marital house is “home” and could want to keep it.
However, there are important considerations when it comes to real estate, especially the marital home. We want to discuss the pros and cons of keeping your house in your divorce with you.
How You Can Keep Your House in Your Divorce
What kinds of factors does the court take into account when dividing marital property? Under Michigan law (MCL 522.401), equitable distribution means that while no single factor is dispositive, the court often considers factors such as:
- Duration of the marriage;
- Needs of both of the spouses;
- Current incomes of both of the spouses;
- Earning abilities of both of the spouses;
- Needs of any children from the marriage;
- Contributions of each spouse to the marriage (both financial contributions and other contributions); and
- How the asset came to be property of the marriage.
In some cases, it might not make sense for the court to consider every factor. For instance, if there are no children from the marriage, the court obviously will not consider the needs of children in dividing marital property. Where does the family house come into play?
Let us imagine that the marital assets have a total market value of $500,000, including some liquid assets (such as savings accounts), as well as art and other collectibles, retirement accounts, furniture, and the marital home. In this scenario, imagine that the marital home is valued at $300,000, and one of the parties (“Spouse A”) really wants to keep it. The court determines that Spouse A should be entitled to 3/5 of the marital assets, and because Spouse A wants to keep the home, the court awards the home to Spouse A and the remaining assets to Spouse B. What could go wrong in this scenario?
Limitations of Staying in the Family Home After a Divorce
If you really want to keep your house and the court awards it to you in a divorce, you could end up with financial difficulties down the road. Even if your home is completely paid off, you may have been awarded the home and, as a result, lost out on liquid assets and other valuable property from the marriage. Why would this be a problem?
You will still owe taxes on the house every year. In addition, unlike a retirement account or a savings account, a home requires upkeep. You could end up owing a lot more money on the house than you have, and your ex-spouse could end up in a newer house or apartment with significant assets to cover any expenses.
Contact a Property Division Lawyer in Michigan
Do you need help with asset division? A Michigan divorce attorney can speak with you today. Contact the law office of Paul J. Tafelski for more information.