Can the Marital Home Be a Significant Bargaining Chip? | IL

 Posted on September 30, 2024 in Property Division

Asset division can be one of the more contentious aspects of an Illinois divorce. The assets with the highest value during a divorce are often the marital home and retirement funds. Yet the marital home may be overlooked for several reasons. If the divorce is particularly acrimonious, both parties may want to sell the home as quickly as possible and split the profits. If the real estate market is high, this could be the best course of action for both spouses. If the real estate market is in a downward spiral, keeping the home could be more lucrative until the market rebounds.

How the marital home is split will also depend on whether the couple has children and whether the court believes keeping those children in their accustomed home is in their best interests. Depending on each couple's specific circumstances, there are many other solutions for the marital home during a divorce. If you are considering divorce, it is important that you understand the value of your marital home before walking away from it. Having a Naperville, IL asset division attorney from the Law Office of Ronald L. Hendrix, P.C. as your legal advocate during your divorce can ensure you receive your fair share of the marital assets.   

Equitable Division vs. Community Property

A handful of states still operate under community property laws, which divide all marital assets in half, regardless of extenuating circumstances. Illinois is an equitable division state, meaning marital assets are divided fairly but may not be divided equally. A fair division of marital assets is determined based on the following factors:

• The length of the marriage

• The contributions of each spouse

•  Each spouse’s post-divorce financial situation

• Which parent will be the primary residential parent

• The future earning capacity of each spouse

• Any pre or post-nuptial agreements in place

Longer marriages often lead to more evenly divided assets, as the court recognizes how intertwined the couple’s finances are likely to be. Non-monetary contributions are considered in addition to financial contributions to the marriage. The primary residential parent may receive a larger share of the marital assets to ensure the children’s well-being.    

Considerations That Determine How the Marital Home is Divided

Perhaps the most important consideration when determining how the marital home will be split is whether the home remains affordable. What was affordable for a couple may no longer be affordable for a single person, particularly when property taxes, insurance, utilities, and repairs are factored in. While a judge might want to keep the children in the home they are familiar with, the primary residential parent may be unable to afford the mortgage payments and all that goes with home ownership.   

If you and your spouse are in your 50s or 60s, whether the home is kept or sold must be viewed from the perspective of both spouses' retirement goals. If one spouse keeps the house in lieu of more liquid assets that could appreciate at a faster rate than the home, adjustments might need to be made to retirement and savings goals. If one spouse wants to keep the home and take over the mortgage, it will likely need to be refinanced so the other spouse’s name can be removed.   

If you both agree to sell the home, do not overlook the tax implications. If the home has significantly appreciated over the years, you may exclude a capital gain of $250,000 if filing single or $500,000 if married and filing jointly. Aside from the financial and emotional implications of the division of the marital home, it is often useful as a bargaining chip. If you know your spouse really wants the home, you may be able to use that to your advantage to get the assets you want in return.

Contact a DuPage County, IL Asset Division Lawyer

The bottom line is that you should never walk away from your share of marital assets, including the marital home, simply because you want the divorce over and done with. Speaking to a Will County, IL asset division attorney can be extremely helpful when determining the best way to divide property. Contact the Law Office of Ronald L. Hendrix, P.C. at 630-355-7776 to schedule your free consultation.