What Happens to the Marital Home in Divorce?
One of the most contested and financially significant issues in many divorce cases is what happens to the marital home in divorce. For many couples, the home is not only one of their largest assets, but also a source of emotional attachment, stability for children, and long-term financial investment.
In Ohio, the marital home is typically addressed as part of the overall property division process. Depending on the circumstances, the home may be sold, refinanced, awarded to one spouse, or temporarily retained during the divorce proceedings.
Atkins and Atkins represents clients throughout Columbus and Central Ohio in complex divorce and property division matters involving marital homes, refinancing issues, equity buyouts, and disputes over who will retain the property after divorce.
Schedule a confidential consultation to discuss your options regarding the marital home and other property division issues.
Can the House Be Sold During an Ohio Divorce?
In many Ohio divorce cases, restraining orders automatically go into effect once the divorce is filed. These orders generally prohibit either party from selling, transferring, or disposing of marital assets — including the marital home — without agreement or court approval.
However, that does not necessarily mean the home cannot be sold during the divorce.
If both parties agree, the court can authorize the sale of the property while the divorce is pending. In some situations, selling the home early may reduce financial strain, preserve equity, or avoid ongoing disputes regarding mortgage payments and maintenance responsibilities.
In contested situations, one party may also ask the court to permit the sale of the home over the other party’s objection, depending on the financial circumstances of the case.
Options for the Marital Home During an Ohio Divorce
There are several ways a marital home may ultimately be handled during a divorce case, depending on the parties’ finances, the amount of equity involved, and whether children are involved.
One Party Keeps the Home
In many cases, one spouse wishes to retain the home after divorce. This often occurs when children are involved and maintaining stability in the child’s school district or living environment is a priority.
However, retaining the home usually requires resolving several financial and legal issues, including:
- Whether the party can qualify to refinance the mortgage
- Whether the mortgage can be assumed
- How the other spouse’s equity interest will be addressed
- Whether the party can realistically afford the property long-term
Refinancing the Mortgage
If both spouses are currently on the mortgage, the spouse retaining the property will often need to refinance the loan into their sole name. This removes the other spouse from liability for the debt and allows ownership issues to be finalized.
Before agreeing to keep the home, it is important to speak with a lender early in the process to determine:
- Whether refinancing is financially realistic
- What interest rate may be available
- How much additional financing may be required to buy out the other spouse’s equity
- Whether support income may be considered for qualification purposes
How Support Payments May Affect Refinancing
When one party intends to keep the marital home, qualifying for refinancing is often a significant issue. In many cases, lenders will evaluate not only employment income, but also court-ordered or anticipated support payments.
Depending on the circumstances, spousal support and child support may be considered as part of a party’s income when determining whether they qualify for refinancing.
Lenders may evaluate:
- The amount of support being paid
- Whether the support obligation is expected to continue
- The consistency and reliability of payments
- Whether temporary or final court orders are in place
Because refinancing approval can directly affect whether a party is able to retain the home, these issues should be evaluated early in the divorce process.
For more information regarding support issues, see our spousal support page.
Does It Matter Whose Name Is on the Mortgage?
In some cases, yes — although not always for the reasons people expect. One issue courts may consider is whether the existing mortgage provides a financial benefit that would be difficult or impossible to recreate after divorce.
For example, if only one spouse is on the mortgage and the loan was obtained during a period of historically low interest rates, that may create a substantial financial advantage for the spouse currently attached to the loan.
If the mortgage is not assumable, the other spouse may be unable to retain the benefit of that favorable interest rate if they keep the home, while the spouse currently on the mortgage would lose the benefit of the existing loan if forced to sell or obtain a replacement mortgage elsewhere.
In those situations, courts may consider the practical financial impact of disrupting an existing low-interest mortgage when determining how to allocate the property.
That does not necessarily mean the spouse on the mortgage is automatically entitled to keep the home. Courts will still evaluate the overall circumstances of the case, including equity, financial feasibility, and whether the property is marital or separate under Ohio law.
What Happens to the Equity in the Home?
In many divorce cases, the marital home contains substantial equity that must be addressed as part of the property division process.
Typically, if one spouse retains the property, the other spouse may be entitled to an equity payout. This may occur through:
- A cash payment
- Refinancing additional funds out of the property
- Offsetting the equity with retirement accounts or other marital assets
In some cases, offsetting other assets may reduce the need for significant refinancing and allow the retaining spouse to preserve more favorable mortgage terms.
High-Asset Divorce and the Marital Home
In high-asset divorce cases, the marital home may be only one part of a larger financial picture. The home may need to be evaluated alongside business interests, retirement accounts, investment portfolios, separate property claims, and support obligations.
In these cases, decisions about the home should not be made in isolation. Whether one spouse keeps the property, whether the home is sold, and how equity is divided should be considered as part of the overall financial resolution.
For more information about complex divorce matters involving substantial assets, see our high-asset divorce page.
What If Both Parties Want to Keep the Home?
Disputes over the marital home are common, particularly in high-conflict or high-asset divorce cases.
When both parties wish to retain the property, courts may consider:
- The best interests and stability of the children
- Which party is financially able to maintain the property
- Whether one party has a significant separate property interest
- The practical impact of refinancing or replacing an existing mortgage
- Each party’s overall financial circumstances
For example, courts may consider whether forcing the sale of a property would eliminate the benefit of an unusually favorable mortgage interest rate or create unnecessary financial hardship for both parties.
Can Separate Property Affect Who Keeps the House?
In some cases, one spouse may have a stronger claim to retaining the home because of a separate property interest.
This can arise when:
- The property was inherited from family members
- One spouse owned the home prior to marriage
- Separate funds were used toward the purchase of the property
- The property has longstanding family significance
However, separate property claims can become complicated if marital funds were later used toward mortgage payments, renovations, or improvements.
For more information regarding asset classification and division, see our property division page.
Why Early Planning Matters
Because the marital home is often one of the largest financial assets in a divorce, decisions regarding the property should be evaluated early in the process.
Before making decisions regarding the home, parties should consider:
- Current mortgage terms and interest rates
- Whether the mortgage is assumable
- Estimated equity in the property
- Refinancing qualifications
- Long-term affordability
- Potential tax consequences
Consulting with both an experienced divorce attorney and a qualified lender early in the case can help avoid costly mistakes and unrealistic expectations.
Contact a Columbus Divorce Lawyer to Discuss the Marital Home
Disputes involving the marital home can significantly affect your financial future after divorce. Whether you are seeking to retain the home, negotiate an equity payout, or determine whether refinancing is realistic, strategic planning is critical.
Atkins and Atkins represents clients throughout Columbus, Ohio in divorce and property division cases involving complex financial and real estate issues.
Contact our office today to schedule a confidential consultation regarding your divorce and property division matter.
