The end of a marriage can be a challenging time for various reasons. You will almost certainly require some form of support to navigate a divorce, but people often overlook the importance of practical advice. Even though some tasks may seem minor, specific actions are necessary to ensure both parties achieve a clean break.
Assets are one area that must be appropriately managed. Typically, the largest asset married couples possess is property. Therefore, it is essential to understand your rights regarding the sale of property as part of a divorce.
Mistakes Are Costly When it Comes to Property Sales.
The internet is an excellent resource for finding information and learning new skills. However, there are limits. Do you want to rely on information you’ve pieced together from the internet regarding selling a property worth £100,000, £200,000, or significantly more? While there’s no legal requirement to enlist the services of divorce lawyers, it’s a wise decision given what’s at stake.
Let’s be honest: going through a divorce can be an emotionally distressing and draining time in your life. It’s not uncommon to find it hard to think clearly about even the simplest things, let alone arrange a clean and fair sale of your marital home. It’s not worth cutting corners or taking risks.
Qualified divorce lawyers can advise you and your former partner on the legal aspects of selling a property and ways to ensure a fair division of the assets. They can even establish legally binding agreements related to all aspects of a divorce, including the financial division of any assets sold. This is particularly important when selling a property, as splits aren’t always 50/50.
Suppose, for example, one person contributed more to the property’s deposit. That person should be entitled to a larger share of the proceeds from the house. Another situation in which you need assistance from qualified lawyers involves appraisals and valuations. One person shouldn’t be solely responsible for obtaining a valuation, as they could deliberately manipulate the figures.
A divorce valuation report is the fairest solution. A chartered surveyor provides an independent report that assesses the property’s market value. Crucially, this is not based on an estimate from an estate agent. Instead, it relies on a stricter framework established by The Royal Institution of Chartered Surveyors (RICS), giving you confidence in the valuation figure.
You Can’t Do Everything Yourself
What about a situation where one person doesn’t want to sell the property? A divorce lawyer will advise you that one person can’t forcefully stop the sale of a property if the other party wants to sell. However, if this situation occurs, lawyers can create a legally binding settlement, such as one person buying the other’s equity in the property.
This is known as a ‘transfer of equity,’ in which one partner transfers their legal share of the marital property to the other. It’s not an easy task, though. Many divorcees don’t have the capital to buy out their former spouse. In such cases, many must consider taking out a larger loan through a remortgage. The challenge here is convincing mortgage lenders that you can afford the repayments based solely on your income.
Ownership must also be considered if one of you wants to sell while the other refuses. Generally, a property isn’t regarded as a marital asset if one person is the sole owner, but even this is not straightforward. If the property was acquired during the marriage and used as the family home, there’s a valid argument that it is a marital asset. Furthermore, only a divorce lawyer can provide accurate advice in this situation.
The situation becomes even more complicated if children are involved. In fact, if children, the elderly, or disabled individuals reside in the property, neither party can legally enforce a sale. A sale can only be enforced if both parties have sufficient funds to purchase or rent new accommodation from the proceeds. Additionally, no children or other dependents can be included in the process.
You also need to consider the tax implications of selling your marital home. The transfer of equity between spouses does not incur a bill for inheritance or capital gains tax. This remains true for the duration of your separation, right up to the decree absolute. If a transfer of equity occurs while you are still legally married or in a civil partnership, stamp duty land tax is typically not payable.
Our message is clear: Don’t attempt divorce sales on your own. We offer numerous articles to help you save money on buying and selling properties, including comparisons of estate agents and mortgage advice. However, some tasks cannot be accomplished without expert assistance. It’s possible, but the potential pitfalls are too significant. Therefore, educate yourself as much as possible, but use this knowledge alongside advice from qualified professionals.
Further Reading
1. https://www.gov.uk/money-property-when-relationship-ends
2. https://www.thehouseshop.com/compare-estate-agents
3. https://www.thehouseshop.com/mortgages
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