Divorce: Know your property options

Mandi Smallhorne
2013-08-06 14:52
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Pretoria - So you’re getting divorced: What happens to your family home?

You’ve got a few options, but your final decision will often be dictated by circumstances: Can you afford to take on the expense of the full bond repayment by yourself?

Who paid the original deposit on the house?

Do you want to stay in a house which is full of bad memories? Can you get a good price for the house?

You sell the house and divide any profit between you and your husband

This might not be a savvy solution in a property market that is a sluggish buyer’s market.

If you bought your house more than a couple of years back, you probably paid more than it will fetch today.

You buy the house – or his share of the house – from your husband

If the house is in his name, it can be transferred to yours, but if the house was bought in both your names, you will have to re-finance it.

That may be difficult. You originally qualified for a home loan using both your incomes.

The most important question here is: Can you afford the bond repayment once you are divorced, if your income is going to be reduced significantly, as usually happens?

He buys the house, or your portion of it, from you

If this is the option you go for, make absolutely sure that the house has been taken off your name, to protect your credit rating.

You choose to own the house together

This may happen where couples look on the home primarily as the place where their children live and are willing to commit to maintaining it and financing it together in order to secure their children’s living conditions.

If this is your choice, and even if the divorce is amicable, make sure you have a carefully worded agreement which covers all eventualities.

Who paid the deposit?

When a couple is happy together, it never occurs to them that accepting help with a deposit on a house from mom and dad might lead to problems. But when divorce looms, it could become something serious.

Whose mom and dad paid the deposit? Will they want it back if you divorce? Did they lend it to you on condition they live in the cottage on the back and, if so, what are their rights now, if you split and sell the house?

Whenever money is lent between family members, no matter how much trust there is, it’s a good idea to draw up a proper agreement that outlines what was lent, what conditions were agreed to, and how the loan is to be dealt with if conditions change.

- Fin24

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