A vacation home can offer a nice escape from one’s busy everyday life, while still being a home away from home. It might be a nice retreat for the whole family, but it can become a large point of contention for spouses in the event of a divorce.
If spouses face a divorce, they often know that they must divide their property between them. However, dividing real property, like a vacation home, can quickly become complex.
How do spouses divide a vacation home?
A vacation home is subject to equitable distribution, just like any other marital asset Illinois spouses own. Even though it is subject to the same rules, there are a few ways that spouses can handle their vacation home in a divorce.
They can:
- Divide time: If spouses are determined to keep the vacation home, one option they have is to continue owning the property together and fairly divide the time they spend in the home, as well as the costs that come with it. This would require a detailed agreement to ensure that spouses remain on the same page.
- Divide property: In some cases, one spouse might be able to retain the property in their name, as long as they buy out the other spouse’s share. This option also requires careful thought and planning since individuals must transfer titles to their name alone to maintain rights to the property.
- Sell and divide proceeds: In other cases, whether or not they face serious disputes, spouses might choose to sell the vacation home and divide the proceeds equitably.
Regardless of the option spouses pursue, they should obtain an official appraisal of the property to determine its value, just like they must with the marital family home.
What else should spouses consider?
In a divorce, spouses should consider the options listed above carefully to determine which one best meets their needs and interests. Additionally, they should also consider the financial aspects of the property, such as:
- Did one spouse invest more money into updating the property and increasing the value than the other?
- How much do spouses owe in property taxes, dues and other related payments each year?
- Do spouses have a mortgage for this property? Is it paid off, or will they have to refinance?
It is essential to approach the property division process with great care, especially when it comes to valuable assets like vacation homes.