When couples are divorcing or dissolving a civil partnership one of the main concerns is very often what is to happen to the family home. This is not only a practical issue, but also often has an emotional impact.
Careful thought needs to be given to the options available in the hope of finding a solution that works for you and your family. There are lots of factors that should be taken into consideration.
One of the first things to consider is how much equity there is in the family home. “Equity” means the value of the property less the amount of any outstanding mortgage owed and notional costs of sale i.e. the likely legal and estate agents costs of sale.
If there is a substantial mortgage on the property then there may not be much equity in the house and this will be an important consideration when thinking about what to do and whether it is financially sensible or even possible for you to keep the family home.
If you have any children, then the needs of those children are the first consideration when deciding what should happen to the family home.
Legal ownership of the family home
One thing to bear in mind is that the legal ownership of the family home does not limit a Court’s powers on divorce or dissolution of a civil partnership as to how the house should be dealt with. Even if the family home is legally owned by one spouse or civil partner rather than being in joint names then the Court will still have the same flexibility about how the property should be dealt with in the event of a divorce or dissolution of a civil partnership.
If the property is jointly owned, it will be helpful for you to find out which form of joint ownership applies in the case of your property. If you are unsure, your solicitor will be able to identify the nature of that joint ownership from the records held by the Land Registry. The two most common forms of joint ownership are beneficial joint tenants and tenants in common and these are explained below:
Joint tenants – you both have equal rights to the whole property, the property automatically goes directly to the other joint owner if you were to die and you cannot pass your share of the property through your Will.
Tenants in common – you can own the property in different shares, not necessarily 50:50. Your share will not automatically go directly to the other joint owner in the event of your death and you can choose how and to whom you pass your share in your Will.
It is possible to change from being joint tenants to tenants in common by what is known as severing the joint tenancy. This is done by serving a Notice of Severance on the other joint owner and then registering that change at the Land Registry. This option is something that you should discuss with your legal advisor before deciding if it is right for you.
If the family home is jointly owned, then neither of the joint owners can force the other to sell the property but it is possible for a Court on divorce or dissolution of a civil partnership to order the sale and prescribe how the proceeds of that sale are to be divided between the owners. This will not necessarily be equal.
It is possible for the family home to continue to be jointly owned even after a divorce if this is something that would work for you and your family. It is not unusual for the family home to be retained for the period of time during which the children of the family are still at school and the property sold after the youngest child finishes their school education. The Court has the ability to make orders that either keep the house in joint names or transfer the property into the sole name of one of you with either a payment being made to the other on completion of the transfer or at a later date. The Court can also make orders setting out who is to pay the mortgage installments and for any repairs and maintenance of the property that may be required before the house is sold.
Whilst you may wish to keep the home as a base for your children in an effort to keep the disruption caused by the breakdown of their parents’ marriage to a minimum, this may not be financially viable and it is important that expert legal advice is sought to explore the options available and attempt to find one which is a solution for the whole family.
How can we help?
If you need advice on the subjects discussed in this article or have any other family law-related queries, please contact a member of our expert Family Law Team in Derby, Nottingham, or Leicester on 0800 024 1976 or via our online form.
Angela or the team will be happy to discuss your circumstances in more detail and give you more information about the services that our Family Law team can provide along with details of our hourly rates and fixed fee services.
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