When you're going through a divorce, you are probably feeling an incredible amount of stress and emotion. Making good decisions can be difficult when those emotions run high. However, the ability to remain calm and practical in making decisions is a must, especially where your financial future is concerned. Real estate is one area where people make mistakes during divorce.
There are many real estate mistakes to be aware of that can dramatically affect your finances. Here are three of the most common real estate mistakes:
- Not knowing what counts as marital property. Did you know that if you purchase a house or condo after moving out of the house you and your spouse own, the newly purchased property can become marital property? This can be the case even though your name is the only one on the mortgage. This new property could be considered in divorce proceedings as a marital asset. Before making any big-money purchases during divorce, understand what counts as marital property.
- Making verbal deals with a spouse. You should never do this. All agreements should be put in writing. Better yet, speak with a divorce attorney about how to proceed. An attorney can make sure the proper paperwork is filed for you, so you don't get surprised later when your spouse reneges on the verbal agreement.
- Thinking it doesn't matter that your name is on a lease or mortgage. Your responsibility does not disappear if your name appears on that legal document. You need to have your name removed if you are not awarded that asset in the divorce. Speak with the lender about how to accomplish this. Your credit could be on the line. You could also be held responsible for the payments.
Paying careful attention to financial details will pay off in the long run. Don't let the stress, hurt and anger of divorce cloud your better judgment where finances are concerned. Your future security depends on it. How will you watch out for your finances during divorce?