All Rights Reserved. In Illinois, what happens to your property in a divorce? Today we answer some fundamental questions surrounding property ownership and division in Illinois: Can I sell my property? What is marital property? How is marital property divided? Search for:. How Can We Help?
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- FREQUENTLY ASKED QUESTION FOR DIVORCE CASES.
- How can I keep my house during a divorce? How can I sell it?.
Notice: JavaScript is required for this content. Email Us For A Response. Gauthier Family Law. Phone: Fax: Stipulation means agreement.
Types of Divorce in Illinois: Fault-Based & No-Fault
Therefore, a stipulation and order is an agreement that becomes a court order. Possibly the easiest way to sell the house during a divorce is through a written and signed agreement between the spouses that then becomes a court order. Effective legal representation is important. Speak to your family law attorney about the terms that fit your needs. Some of those may be the following:. On the issue of characterization, there is a common misconception that just because there is a dispute about the community versus separate property nature of the residence, the house cannot be sold.
Sometimes, that is true but it doesn't have to be like that in every case. Agreements are great but sometimes, there is none to be had. What then?
What Happens to Your House When You File for Divorce in Illinois? | Peoria, IL Patch
Can the house still be sold during the divorce? The short answer is yes. You don't have to wait until the end of the divorce to have the house sold. But if you want it sold before the trial, there needs to be a very good reason. Here are two common ones we see. These are not the only basis for selling the home before the divorce trial.
Selling the house during divorce because of the threat of foreclosure : Whether only one spouse lives at the house or both spouses do, failing to make the mortgage payment can result in foreclosure proceedings.
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Sometimes, failure to make the property tax payment can have a similar consequence. If the home is in danger of foreclosure, especially in those situations where there is equity in the home and a foreclosure may cause the likely loss of that equity, a spouse can file a request for order with the court and ask the court to order the home sold immediately. Hopefully, one or both of the spouses will move diligently on this issue as a foreclosure is rarely in either spouse's best interest.
Selling the house during divorce to pay for attorney fees and costs : Some divorces have hotly contested issues, such as child custody , support or even property disputes. For example, if the spouses have significant child custody disputes due to serious allegations of abuse or false allegations of abuse , the fees and costs may be significant. If neither spouse has the ability to pay for those fees and litigation on custody is inevitable, it is not unusual for an attorney fee request to be filed and the court be asked to liquidate an asset to pay for such fees.
A house is only an asset. The family court does not attach any emotion to it. The more common scenario, assuming there is no imminent need to sell the house during the divorce and before trial, is to order its sale at the conclusion of the case. There are plenty of reasons this issue may go to trial including a situation where neither spouse has the ability to buy the other spouse out or neither spouse wants to do so.
There are also situations where one spouse has been so unreasonable in their position or refusal to settle that an agreement could not be reached on how to resolve the house issue. We have written a comprehensive article on California divorce trials. Of course, there is always Uncle Sam. Selling a home can have tax consequences, including but not limited to capital gains taxes and even taxes related to any depreciation that may have been taken as to rental property. Please consult with your tax professional for advice.
Buyouts are typically by agreement stipulation and order. It is possible the Court could order a buyout although that is not as common. The issues related to buyout of the house during divorce are similar to those related to its sale. Think of it this way - one spouse is selling the house to the other, except both spouses can skip the listing, marketing and showing of the property.
Buyout of a house during divorce can occur in different ways. One common way is the spouses, though their lawyers, agreeing to use an appraiser everyone trusts. Once the appraisal comes back assuming both parties agree to the price , that sets the fair market value of the house. From there, the mortgage and other encumbrances are deducted to determine the equity value. Assuming the spouses and lawyers agree on the community versus separate property issues, they will typically work together to come up with a buyout number. Let's further assume the house is community property and that is not in dispute.
A buyout doesn't have to involve cash payment. A buyout of a house during divorce can include an offset of other assets in exchange for the buyout or even an offset toward compromises reached on other issues spousal support, attorney fees, etc. How two spouses and their lawyers create the buyout payment or offset depends on the facts of the particular case. When the house has equity, the buyout process and that equity go hand in hand.
Home Ownership & Divorce in Illinois
But what happens when the house does not have equity? How is a house sold or bought out during divorce when there is no positive value? No equity homes sometimes present a greater challenge than those with equity. The lack of equity can lead to attachment of sentimental or emotional value or its use as leverage. For example, if the husband wants to sell the house but the wife wants to stay, the husband may insist on the house being sold unless he gets something else in return, even though the husband knows nothing will come out of the sale.
You can probably figure out there are several scenarios where situations like this can be used for better or for worse in negotiations. While there is no specific "fix" for this situation, sometimes a bidding war can start over a home in this situation. Essentially, whoever wants the house agrees to pay more for it or offsets it with another asset. While this isn't the only solution, absent common sense kicking in, in our experience it is a common one. We hope you enjoyed this article.
