Divorce and (Negative) Equity in Family Residence

In today’s world, more and more couples are opting to stay married in hopes that the value of their homes rise. Indeed, thousands of home-owning couples owe more on their mortgages than their homes are worth. This is especially true in states such as Nevada.
Indeed, 60 percent of Nevada homeowners who have mortgages owe more than their homes are worth, says the Santa Ana, Calif., analysis firm CoreLogic. Because of this, more couples are staying together for the sake of their home only because they cannot afford to get out of the whole.

There are other couples who will go through with the divorce but continue to own their home jointly in hopes that the market will improve years later. But jointly owning a property after divorce is a cause of concern. Specifically, the newly divorced couple will have to decide who will pay for what. Who will cover the cost of the mortgage, taxes, insurance, utilities, repairs, maintenance?

Another option for couples is to short sale their home. But, real estate analysis say that this causes messy tax implications.

At any rate, if you are contemplating filing for divorce in Los Angeles or Orange County, contact an Orange County divorce lawyer for more information.

Source: Divorcing couples struggle with negative equity in their home