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Friday, November 11, 2022
real estate advice Safire Real Estate Vendors

Selling your home in case of separation

Selling your home in case of separation in Spain is almost always the most advisable option after a divorce without children, or if there is a good understanding between the two parties. But you can also find the ideal solution in the so-called condominium extinction. We explain it to you.

Division of the family residence in case of separations

When a couple breaks the separation, it can be done in an easier or more complicated way, that it will depend on each one. What is clear is that the time has come for the separation of assets, and that is where there may be problems: especially with the distribution of the family residence. Thus we arrive at "I want to sell, but my ex doesn't want to", "my ex wants to keep the house", "I can't keep paying my part of the mortgage"... common reasons for real estate inquiries. We analyze with our team when and how to sell your home in case of separation.


Spain is a country of owners and currently, when a common-law or married couple reside in a house, this in many cases (at least this is the case that we will deal with now) can be owned and acquired jointly. But what happens if at a certain moment you decide to end your relationship? Each separation is a world and will depend on the objectives and interests of each party. But in general, the usual thing would be to reach an agreement and put the house up for sale in order to pay off the mortgage and then split the profits. Or that one of the parties will be the one that resides and, therefore, acquires the entire property to its ownership.


Which brings us to the next question: If it's not my house anymore... Should I keep paying the mortgage?


I don't want to sell vs. I don't want the house

Experience as real estate consultants tells us that if one of the two parties decides that they do not want to sell the house, it is usually for two reasons: either they have received a advice (not necessarily professional) or advice that invites you not to position yourself, much less to rush, or this person is very clear that residing in the home or not, they want to keep the house. Well, the problem is not so much that you do not want the house (among other reasons, because you are not interested, or because you do not want to pay for it) but how to get rid of the economic burdens of the farm.

And although it is true that it is not good to rush, it is not good either to relax in the most comfortable position: which is usually immobility, since at this point, experience tells us that it will be increasingly difficult for you to reach an agreement.


Solution 1: I want to keep the house (and you sell it to me to me)

This option is the peaceful version of I don't want to sell, and possibly the final agreement reached by most ex-partners to sell your home in case of separation. This is so because the party that wants to continue enjoying the property has already considered their situation and offers in this case a compensatory and liberating solution for the other party: I want the house, so I'll buy your share. This solution is surely the most gratifying, since it does not imply any sale to establish yourself, but you can settle the debt with the bank and have them buy your part with a change of ownership. It is a process that is carried out before a notary and is equivalent to that of a purchase sale.

 

Solution two: Termination of the condominium

This transaction is considered a transfer and is much cheaper than the previous solution, since the taxes to be paid are much higher reduced as it is not considered as a sale. Despite the notary and registration minutes. And... Do you remain the owner of the mortgage loan? In this regard, the sole proprietor and the one who transfers the part thereof must notify the bank and negotiate with them.


And it is the new sole owner who must renegotiate his mortgage, interest and possible guarantees. In fact, if the marriage had been celebrated in a community property regime, it would not be necessary to resort to extinction of condominium since it would be assumed that the property is part of the assets of the society (marriage) and when extinction (divorce) a part could acquire the common good from the other in exchange for an economic consideration. 


If the marriage had been celebrated in a community property regime, it would not be necessary to resort to extinction of condominium.


It is possible that in a condominium forfeiture you will not be paid the same amount as in a sale. But if you manage to negotiate successfully with your bank, you will be able to quickly forget about your charges. You should know, then, that the extinction (or dissolution) of the condominium does not mean that the other party is going to pay you half the amount of the house. The fact of being rescued from yourMortgage obligations may be the compensation for the transfer of ownership. In any case, as we say, dialogue and tranquility will be the best environment to reach the best agreement for both parties.


Thirdly... We maintain dual ownership and we can't sell the house, now what?


Keep dual ownership Ownership of a property for not selling your home in case of separation can be a big problem at the fiscal level. Especially if we already have another property, or if we consider that this fact harms us more than it does not benefit us in our personal income tax returns because it is not our habitual residence. In this case, it is time to draw up a joint strategy, although each one for their legitimate and private personal reasons. And it is for this reason that if you are not clear about "what to do with the house" we recommend selling the property as soon as possible in order to successfully make the property profitable. We must also assess that at the fiscal level each option presents its own taxes and this point is something to take into account as well. 


The reasons why which we recommend selling your home in case of separation are clearly cheap. Since both parties (the one who maintains the home and the one who gives up ownership) will have to face a series of expenses that in one case were previously shared (mortgage, supplies, community if any...) and in the other case , they will be new (new housing, etc.) with which solvency and above all, your quality of life, will be clearly diminished. Because in this life it is about security but above all, about being happy. If this situation does not favor either of the parties, a timely negotiation approach is always a correct option that is also beneficial for both. At Safire we explain it to you with full guarantee of confidentiality.


We hope we have oriented you a little more on how and why to sell your home in case of separation. As you know, there are other points to take into account and in some cases where the agreement is not viable, it could be a judge who will dictate a possible sale of the property in case of dispute (with or without common children). And this is how the option to sell or transfer ownership of the property and the mortgage charges with the extinction of the condominium must be firmly valued. There are also other types of sale, but they may not be the most beneficial for any of the parties due to the economic loss they entail. We also remind you that the commercialization of the property, must be by mutual agreement and with the signature of both in the contract of sale, earnest money and deeds, as well as that of the real estate brokerage itself. 


In any case, that is up to each person. At Safire Real Estate we are aware of the hardness of the process and we advise you whatever the reason for which you request the sale. That being said, we are here to keep you informed!