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Home Ownership and Divorce: An Interview with Jeffrey Shaw, Attorney at Law

By Jeffrey Shaw

Tell us a little bit about your firm and the areas of law that you practice.

I have been practicing law in the metropolitan area for more than thirty years. The majority of the matters that I handle are in the areas of divorce and real estate. I also handle a variety of other civil cases including business matters, guardianships and correction of birth certificates. I maintain a policy of being accessible to my clients and providing personalized service. I currently have offices in Manhattan and East Meadow.

What are the main options for homeowners who are going through a divorce?

There are many issues concerning real estate confronting an individual who is contemplating, or in the midst of, a divorce or separation. While there are statutes and caselaw that govern these issues it must be noted that each case is decided on its own facts and circumstances. Generally, the least expensive and quickest way to finalize a divorce action is for the parties to come to an agreement regarding all of the issues that need to be covered rather than engaging in expensive and time consuming litigation which will result in a judge making the decisions for the parties. Among some of the issues that can come up in a divorce case include the following:

  • exclusive occupancy of the home while the case is going on and at the end of the case;
  • selling or renting the home;
  • division of the sale's proceeds;
  • one spouse "buying out" the other spouse's interest in the home;
  • liability of each spouse under their mortgage;
  • capital gains taxes; and
  • appraisals of the home.

How would you recommend that people in this situation decide whether to keep or sell their home?

The decision to sell or keep the home in a divorce case depends on many factors most of which are limited to the specific circumstances of the case. For instance, in many cases one spouse wants to remain in the home for reasons of convenience or sentimentality. However, in most cases the spouse keeping the home will have to pay the other spouse for his or her interest in the property. Oftentimes the home is the largest asset that a couple owns which limits the couple's flexibility to allow one of the parties to buy the other party's interest in the home because there is not enough cash or other liquid assets to use. Some individuals will have enough resources to do this, others may have to take out a mortgage and pay off any existing mortgages.

What are some of the biggest challenges that homeowners face during a divorce?

The biggest challenge facing anyone in a divorce is to overcome the emotional aspects of the divorce so that person can make the best decisions for himself or herself in a well thought out unemotional manner. This is oftentimes easier said than done as a divorce, unlike the dissolution of a business partnership, involves emotions and feelings which take time to deal with.

Are there circumstances when it would be best for people to sell their home and start looking for a new place to live?

There are many circumstances when it would be best for homeowners involved in a divorce to sell their home. Each case presents its own set of facts and must be analyzed in the context of the homeowners situation considering factors such as whether there are minor children who are close to graduating from school and don't want to move to a new school district; the need to obtain the proceeds from the sale of the home as quickly as possible; or whether one party wants to purchase the other party's interest in the home and continue to own it.

From your experience, do you have any advice for recent divorcees who need to buy a new home?

In general, a newly divorced person should buy a new home if their resources allow them to do so. The benefits of homeownership (tax deductions for mortgage interest and property taxes; accumulating equity, etc.) are lost if a newly divorced individual chooses to rent instead of purchase a residence. It should also be noted that it is important for a spouse being paid for his or her interest in the home by the other spouse, that the mortgage on the property be paid off or refinanced so as to remove him or her from liability on the mortgage. An agreement or Judgment of Divorce which provides that the party retaining the home pay all of the expenses of the home including mortgage payments, is only enforceable between the parties, it does not affect the rights of a third party creditor such as a mortgage bank. This means that if the husband is to keep the house and pay the mortgage on it and he defaults, the bank can still proceed against the wife in a mortgage foreclosure proceeding despite the fact that the husband was required to make the payments himself.

What's the best way for people to contact you and your firm

I can be reached at either of my offices by telephone by dialing 212-349-5506, or by e-mail at Jeffreyshawesq@gmail.com.

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