Different things can happen to property in a divorce settlement. Every divorce case is different, and the terms of divorce settlements will vary depending on which state you live in.
Out of Court Settlement
The first option that you have is to come up with a settlement between you and your spouse. This can be done between the two of you or with the assistance of your lawyers. This will involve you and your spouse determining what is fair when it comes to dividing your property. Many times, this cannot be done because there is too much emotion involved. However, some spouses can complete this process without the assistance of the courts.
If you are unable to complete this process on your own, the court will step in to make decisions for you. The judge is going to review all of your assets and try to come up with a fair settlement for each party. The court will use what is called "equitable distribution" for dividing up the property. This means that it will evaluate the entire situation to determine the fairest way to divide the property.
The court is going to look at the amount of income for each spouse and if there is any separate property involved. They are also going to look at the age and health of each spouse. The length of time that the spouses work together will also play a role in the court's decision. The court is also going to look at factors such as if one of the spouses gave up a promising career to raise children while the other spouse pursued a career. The court will look at all of these factors and then issue a decision as to which spouse will get what property.
First of all, the court might order that the house be sold and the profits after the mortgage is paid off be split between the two spouses. In some cases, the judge might order that the sale of the house be postponed until children in the home graduate from high school.
The judge might also decide to allow one of the spouses to continue living in the house. In this case, the spouse that is awarded the property will have to buy out the portion of equity that is owned by the other spouse.
If a buyout needs to occur, the spouses will be able to accomplish this by refinancing the property. The spouse that is keeping the house will need to obtain a new mortgage and pay off the old mortgage with the money. He or she can then buy the other spouse's equity and remove that spouse from the property title.