Top 10 Considerations When Selling a Divorcing Couple’s Home
September 21, 2016 |
Laurence B. Hirsch
Partner, Jaburg & Wilk
In many divorces, the largest marital asset is the family home. Frequently, the parties agree to sell their residence. However, the sale of a community property asset, in the midst of an acrimonious divorce proceeding, can be challenging for agents and brokers. To help facilitate the transaction — ask, ask, ask — because it is likely you will need more information than a standard transaction. Following are the top 10 considerations:
Determine if there are any court orders that prohibit and/or require the sale of the home or require that one party may remain in the residence for a determined period of time.
If using DocuSign or a similar e-signature service, use separate e-mail addresses for each spouse rather than a community or shared e-mail.
If there are Orders of Protection in place, you will need to create a communications protocol to deal with each of the parties separately.
Be cognizant of the fact that while both parties may have signed the listing agreement, they may not have common goals. One may want to sell while the other may not. One may be open to repairing the pool; one may not.
Be wary of tax details in a divorce setting – a client needs to know the potential capital gains and associated tax issues prior to executing the sales contract. Best practice is to recommend seeking advice from a CPA or other tax professional.
Understand that the normal course of price reductions and dealing with the BINSR will be altered. Two parties equals two opinions from two people who likely will not agree on much. Allow extra time for additional negotiations between the selling parties.
Rule 95G of the Arizona Rules of Family Law Procedure allows for the appointment of a Real Estate Commissioner to assist the parties with disposition of community real property when the parties are otherwise unable to agree. Apply to be appointed to the Superior Court of Maricopa County Real Estate Commissioner Roster.
In some cases, the parameters of the sale may need to be discussed with the attorneys for each of the parties. An agreement may be reached wherein issues such a percentage reductions, contributions to necessary repairs, and distribution of net sales proceeds can all be dealt with via a Stipulation which is filed with Family Court.
The house may not stage well. Clear signs of a divorcing couple could give potential buyers an unfavorable impression or advertise desperation to sell. Take a close look at the furniture, the contents of the closet, the landscaping — does it reflect a family in distress?
Although difficult and likely it will require more time, it may be worth taking the listing. If you do a good job as the listing and/or selling agent, there could be two new opportunities to act as a buyer’s agent if both the husband and wife each need a new residence.
Get to know successful divorce attorneys in the Valley. Take them out for drinks or dinner as they will call you for advice on real estate transactions for their clients which often leads to referrals to agents and brokers.