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Who Gets the House in a Divorce in Michigan? 5 Things to Consider and When to Sell

divorce

Divorce is a difficult time for everyone. You’re already emotionally charged and then you’re expected to make a number of other big decisions. One of the most important issues you need to figure out is who gets the house in a divorce in Michigan? 

Your property is probably the most valuable asset you have. Which is why the answer can be complicated — especially if you live in Michigan. 

Here’s what you need to know:

  1. Michigan’s Divorce Laws

  2. Is Michigan a Community Property State?

  3. What if You Have Children?

  4. Who Gets the House in a Divorce in Michigan

  5. When is the Best Time to Sell?

What are Michigan’s Divorce Laws

Michigan is a no-fault divorce state. That means you can legally separate from your spouse if your relationship is broken beyond repair.

However, a judge can always decide if one party was responsible. In which case, you might be given preference over various items depending on your personal situation.

How to File for Divorce in Michigan

To file for divorce in Michigan you need to hand in your Summons and Complaint forms at the county clerk’s office along with the correct filing fee. To be eligible for divorce in Michigan you need to have lived here for at least six months. You also need to have lived in the county you are filing in for at least 10 days.

Is Michigan a Community Property State?

No. In a Community Property State your assets are divided as close to 50/50 as possible. Michigan divides property based on “equitable distribution.” That’s when a judge would divide your assets “fairly” after looking at your individual circumstances.

For example: You could be awarded a percentage of your property based on how much money you make or how much of the mortgage you’ve personally paid. There are also several other factors. 

Marital Property or Separate Property

If you bought the house while you were married, then it’s a marital property

In this case, it doesn’t matter whose name is on the deed or title. Unless it was a gift or inherited from your parents. 

But if you or your spouse bought the house before you married, then it’s a separate property. It belongs to whoever originally owned it. 

There are a couple of exceptions. For example, if you or your spouse invested money in upkeep or renovations — you are entitled to a portion of the profits. 

What if You Have Children?

Your children are the most important factor to consider when deciding who gets the house.

It might be best if one of the parents continues to live in the home with the children. This would give them a sense of stability and normally during this trying time.

But if it’s taken to court they will choose based on the Child Custody Act. This document seeks to support the best interests of your children. It takes into account their emotional, physical and mental wellbeing.

A judge could then decide to delay any sale of the house until your children turn 18. This is called the Mesher Order.

If that happens, both parties can keep a percentage of the property until it’s sold. Then they would receive their respective shares of any sale.

Who Gets the House in a Divorce in Michigan?

Your house doesn’t automatically go to whoever’s name is on the deed. Remember, Michigan deals with assets fairly. But before it even goes to court, there are a few options. You need to decide if either of you want to keep the house or sell it and split the proceeds.

The easiest (and most affordable) option is if you and your spouse decide amongst yourselves. Before taking it to court. Any other way costs money.

If you don’t feel comfortable working this out together, the next step is to have someone mediate the conversation. They would list the different assets and help you decide a fair option. 

What if the Courts Decide?

Or you could let the courts decide. A judge will base their decision on a number of factors:

  • Your age

  • Whether there are any health issues

  • How long you’ve been married to your spouse

  • If you have any children

  • Is the house a marital property or separate property

  • How much each of you put into the house

  • Was one person at fault for the divorce

When is the Best Time to Sell?

Typically the best time to sell is in spring. But you want to list when there is high demand but low supply.

At the end of last year, Grand Rapids experienced just that. The market overwhelmingly favored sellers. This meant people were able to sell their houses much higher than normal. That trend looks set to continue in 2021 as we continue to experience historically low mortgage rates at 2.73%.

But if you’re going through a divorce there are other factors you need to take into account.

Taxes

Whenever you sell your home, you need to pay Capital Gains Tax. It’s a large chunk of money you have to pay the government whenever you cash in on a major asset. 

But if you’ve lived in your home for at least the two of the past five years then you’re eligible for a tax exemption. That’s right. You can claim up to $250,000 in capital gains tax or $500,000 if you’re married.

What to Do Next

It’s important you don’t make any uninformed decisions when you’re going through a divorce. 

You do not want to make any mistakes when it comes to the most valuable things in your life.

So give TJ Homes a call. Our homeowner strategy sessions will give you the clarity you need to make the best choices for your family.

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