For many New Jersey spouses going through the divorce process, getting a fresh start is important. However, others feel a need to remain connected with the past. Exactly how the family home is viewed and ultimately awarded as an asset to one of the parties becomes a major issue in the final property division settlement. This is especially true when minor children are involved.
Although the general practice is that each party in the divorce receives an equal share of marital property, they almost never get exactly the same distribution of assets unless everything is liquidated and the two split the cash. For many couples, the family home is the single largest asset. If one party is awarded the home, the other receives other assets equal to 50% of the home’s equity. The issue, however, is not the separation of the assets but whether the party who keeps the home can afford to do so.
Initially, it will be necessary for the party retaining the home to buy out the other’s share. This often entails refinancing, which may be a problem considering the ability of the newly single party’s ability to earn income and qualify for a mortgage. Without a refinance, the party who no longer retains the home due to the divorce settlement will nonetheless remain obligated for payment if the other spouse defaults.
Even when divorce is the right course to take, property division can be a contentious matter. An experienced family law attorney can provide an understanding of the rights and responsibilities of the parties during this difficult time.