When couples in Alberta file for divorce, one of the most challenging decisions they must make involves the family home. While it is natural to feel the emotional need to keep the house, it usually makes more financial sense to sell it and share the profit. When selling real estate in divorce, it can be tricky to make sure the transaction benefits both spouses, and it may help to consider some matters.
Timing plays a vital role in selling real estate. When a couple is forced to sell the home quickly, and without regard to the state of the market, the result may be less profitable than selling when there is good liquidity in a strong market. It may also not be wise to advertise the fact that the sale is part of divorce proceedings. If the sale is court-ordered, prospective buyers will have access to court documents that even specify the minimum price that will be accepted.
The couple may need to take measures to cope with the transaction costs of selling real estate, which could take a sizeable chunk of the sales price. Along with fees related to breaking the mortgage, there may be Realtor commissions, legal fees, land transfer taxes and the relocation costs. Before making the final decision, it may be wise to look at the prices of other property that will be available at half the net amount that the sale of the house may yield.
Any Alberta resident who considers selling real estate as part of a divorce may be wise to seek the support and guidance of an experienced real estate attorney. It is tough not to let emotions cloud the mind when dealing with some divorce issues, and a lawyer can evaluate all the relevant matters before providing valuable input and explaining the financial consequences of such a step. This may allow the divorcing spouse to make informed decisions that might prevent entering single life with loads of debt.
Source: business.financialpost.com, "Getting a divorce? Here are four things to consider before selling your real estate", Garry Marr, Accessed on May 26, 2017