Is It Ever Worth It to Keep the House in a Divorce?

The Oregon divorce process addresses and resolves issues involving child support, custody, parenting time, spousal support and property distribution. The court decides all matters concerning the parent-child relationship by applying the best-interest-of-the-child standard. 

A couple brings their property into the marriage and accumulates more throughout the marital relationship. When they decide to get a divorce, they divide the property. They may agree on which items each person should have and do not dispute who should own the property. In other cases, both parties want the objects and require the court to resolve the ownership issue. 

Property division in an Oregon dissolution of marriage involves two property types – marital and separate. An item is separate property if an individual acquired it before they married. A spouse also can have separate property they obtained during the marriage if the spouse received it:

  • As a gift only to one spouse and continuously held as separate from the moment of receipt
  • By inheritance
  • By device
  • By operation of law
  • Through a will
  • As a designated beneficiary

Marital property is property acquired during the marriage, even if the title or ownership is jointly or separately held. Whether the couple’s marriage is decades-long or shorter-term, they can accumulate substantial property over time. One of the most significant purchases during the marriage is the marital house. While it can have sentimental value, it is the highest financial asset of the marriage. 

A house owned by one person before getting married can become marital property after marriage. Transmutation occurs when separate property changes to marital property by using marriage funds to purchase or maintain an item. It also happens when spouses mix separate and marital property to use for the marriage. 

The parties can resolve the distribution of the marital home by agreement or court judgment. Commonly, the resolution is to sell the home and divide the net proceeds. However, issues such as the housing market, credit, and children can make it worth keeping the house in a divorce.

The housing market is everchanging. It has periods of highs and lows that can interchangeably benefit and disadvantage home buyers and sellers. According to the National Association of Realtors, the projected decrease in home sales from over six million in 2021 to 5.9 million in 2022. The decline occurred for 11 consecutive months by December 2022. The prices of houses can fluctuate from month-to-month. The sellers may decrease the amount they ask for due to a low demand of buyers or a downfall in the economy.  Adversely, high demand for homes benefits sellers and allows them to request a higher sale price. The unpredictability of buying and selling a home is a good reason to keep the house in the divorce. 

Credit is one of the essential factors in purchasing a house for individuals who apply for a mortgage. Cash buyers made up approximately 30 percent of home purchasers in 2022. However, for other people, financing is their best or only option to pay for a home. Lenders look at a person’s credit history and score to determine whether to approve the mortgage loan, for what amount, and the interest rate. A credit history is a record of money borrowed and repaid. It also shows activities and statuses, such as: 

  • The number of active credit cards
  • Current loans
  • Patterns of debt repayment and paying bills on time 

Circumstances occur during the marriage that can negatively affect a person’s credit, making it more difficult to purchase another house after the divorce. For individuals that seek housing as renters, landlords can screen applicants by obtaining their credit reports. Therefore, keeping the house in the divorce can bypass credit concerns and ensure the person has a place to live.

One of the most significant reasons it is worth keeping the house in a divorce is the stability and well-being of the children. Divorce can cause stress on the whole family, especially minor children. Dissolution of a marriage is a substantial change in a child’s family structure. The child may have to adjust to a sole or joint custodial arrangement, and the familiarity of the marital home can maintain normalcy. If the house is the child’s primary residence, the child’s schooling and social activities can remain the same.

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