Before or After: When is the right time to sell a house during a divorce?

Getting a divorce and selling a house are hands down the two most complicated processes that a divorcing couple has to go through. Selling the house is challenging enough during the best of times. Throw divorcing spouses into a legal battle and you have the makings of a perfect storm. Weather divorce and selling a house with this guide.

Who Gets The House In A Divorce?

It seems like yesterday you were newly married. These days you’re negotiating with your spouse, whom you’re going to divorce, who gets the house. In a divorce, who gets the house depends on several factors:

  • If one partner bought the house, they might keep the home after the divorce, especially if they have a written agreement in place, such as a prenuptial agreement. 
  • If the house is a marital home, it will be divided equally between the two spouses, along with other marital property. A home obtained and bought while the two parties are still married is the marital home.
  • Some states go about the division of assets by determining who spent more money on the house. In a single-income household, if one spouse contributed more to the upkeep or mortgage payments of the home, they would get a higher percentage of the home’s future sale earnings. 
  • If you reside in a community property state, all marital assets will likely be split equally by the two parties. 

Texas Is A Community Property State

In states like Texas, everything bought or acquired during a marriage is considered equally owned by each party, regardless of the name on the deed. These are called community property states, and other states include Wisconsin, Washington, New Mexico, Nevada, Louisiana, Idaho, California, and Arizona. 

In contrast, separate property is any asset owned before the marriage, received or inherited during the marriage, and anything either party earned after separating. The separate property belongs to one person alone. 

Texas advocates for equitable distribution. A judge determines what is fair and equitable. The court will add up all the assets and liabilities, divide the amount at the bottom line and attempt to award roughly equivalent assets. In large assets, one spouse might get the house while the other will receive a stock portfolio or art collection in the same amount, assuming that one of the spouses wants the house and can continue to afford it. 

What Happens To The House During The Divorce?

What happens to the house in a divorce? Any real estate agent worth their weight in salt will advise you to sell your home before filing for divorce. There’s little room for buyers to negotiate the list price if they’re not privy to your motivations.

What if I wasn’t able to sell my house before divorce? If you have already filed for divorce, selling property before the divorce settlement is not allowed. A court order will prevent the sale until the divorce is over. In a nutshell, a court-ordered sale of a house in a divorce is not possible. 

What If We Want To Sell The House Before The Divorce?

We mentioned that selling community property before divorce is the best-case scenario. You and your spouse are less likely to have property disputes such as who will maintain the property, who pays the mortgage, and who gets to live in the house. Without divorce proceedings to deal with yet, you can focus on repairs, showings, and negotiating for the best possible sale price. 

However, if you agree to sell before divorce, one of the main concerns is staying physically together, which can be problematic. Perhaps you prefer to have a different primary residence as soon as possible. 

What Happens To The Mortgage If One Spouse Keeps The House?

The spouse who keeps the home will be responsible for paying the property taxes, insurance, and mortgage to avoid penalties and foreclosures by lenders and banks. A divorce attorney can document how either spouse will cover the utilities, mortgage, and other bills until the divorce settlement. 

It is worth noting that you and your spouse would remain on the mortgage agreement. Talk to your lender as soon as you can if you are divorcing to discuss refinancing and establishing your rights. You wouldn’t want your estranged partner to mortgage, sell, or transfer the family home without your knowledge. 

House Options When Going Through A Divorce

Agree And Sell First

Two advantages of parties agreeing to sell first before filing for divorce are that you might benefit from the capital gains exemptions on homes valued at less than $500,000 and not have to worry about the mortgage anymore.

You and your spouse can open a new interest-bearing joint account and divide the proceeds from the sale from there. 

This option results in a fast divorce. 

Buy The Party Out

Maybe you don’t want to sell the home outright. Perhaps it’s in a great location near school or work. However, buying out the home from your partner means you must be able to afford payments on your own. 

There are also tax implications like paying capital gains tax when you keep the house and then sell it in less than two years. 

Sell After The Divorce

According to realtors, selling a house after a divorce agreement is the second-best scenario next to selling before the divorce. One spouse is in control and makes all the decisions by themselves when the divorce is finalized. Plus, homebuyers cannot easily read your motivating factor for selling a house after a divorce.


Navigating family law is only one of the most stressful parts of going through a divorce. When you want to remove the weight of selling a home off your shoulders, maybe you and your spouse can explore selling to a cash buyer. You can close in as little as two weeks when you sell to a real estate investor. 

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