For many families in New Jersey, the marital home carries far more weight than just its market value. It can be where children grew up, where milestones were marked, and where everyday life took shape over the years. When a marriage ends in divorce, deciding what to do with that property can feel like one of the most emotionally charged parts of the process. Understanding the available options before entering negotiations can make a meaningful difference in the process and the outcome.
Key Takeaways
- New Jersey is an equitable distribution state, which means that the Court considers many factors to divide the marital home fairly, but not necessarily equally, between spouses.
- Several options exist for the equitable distribution of the marital home, including one spouse buying out the other’s interest or both spouses selling the property and dividing the proceeds.
- The most reliable way to determine a home’s value during divorce is to obtain a professional appraisal by a licensed real estate appraiser.
How does a Court Decide How to Divide a Marital Residence in New Jersey?
New Jersey follows equitable distribution laws, meaning that marital property is divided in a way the Court considers fair, although not necessarily evenly. The marital home, when acquired during the marriage, usually qualifies as marital property subject to equitable distribution. A judge weighs a number of statutory factor when deciding how assets are allocated, including but not limited to: the duration of the marriage; the age and physical and emotional health of the parties; the standard of living established during the marriage or civil union; any written agreement made by the parties before or during the marriage concerning an arrangement of property distribution (e.g., prenuptial and postnuptial agreements); the economic circumstances of each party at the time the division of property becomes effective; the income and earning capacity of each party, the extent to which a party deferred achieving their career goals; and any other factor that the Court may deem relevant.
Can One Spouse Keep the Home After a Divorce?
Yes, although doing so usually requires buying out the other spouse’s share of the equity. Because home values have risen considerably in recent years, those buyouts can involve substantial sums. These sums may be offset by allocating other assets and debts. However, in many cases, the spouse keeping the home must qualify to refinance the mortgage solely in their name.
What Happens to the Home When Children Are Involved?
When minor children are part of the picture, the court may consider the value of keeping the children in a stable environment, which sometimes means allowing the custodial parent to remain in the home during the litigation. If a Court ultimately decides that it is in the children’s best interests to stay in the home following the parties’ divorce, the Court may permit a deferred sale, which allows the children and the custodial parent to stay in their school district and community while the parents work toward a longer-term resolution.
How Is the Value of the Home Determined?
A licensed real estate appraiser is the most reliable way to determine the home’s current market value, and this figure becomes the foundation for all property negotiations. If the parties cannot agree on a single appraiser, each may hire one independently. The appraised value, minus any outstanding mortgage balance, represents the home equity available for division.
What if Both Spouses Want to Sell the Home?
Selling the home and splitting the proceeds is often the most straightforward resolution to the equitable distribution of the marital residence, particularly when neither spouse can afford the property on a single income. After the mortgage is satisfied, both parties divide the remaining equity according to the terms of their marital settlement agreement or a court order.
Frequently Asked Questions
Can a spouse be forced to sell the marital home in New Jersey?
A court can order the sale of a marital home, either pendente lite or on a final order, if the parties cannot reach an agreement independently. On a pendente lite sale, a judge may order the establishment of a litigation fund, may direct that the proceeds of the sale be held in trust, or may distribute some or all of the proceeds of the sale to the parties. On a final adjudication, a judge will equitably distribute the proceeds of the sale to the parties in accordance with the statutory factors.
What happens to home equity if only one spouse paid the mortgage?
Even if one spouse made all the mortgage payments during the marriage, the equity may still be treated as marital property under New Jersey law. Courts look at the full picture of each spouse’s contributions to the marital enterprise, including non-financial contributions such as childcare and household management, in determining how to distribute the equity of the property fairly.
Does it matter whose name is on the deed?
The name on the deed does not automatically give that spouse sole ownership in a divorce. The courts will look to when the property was acquired, how it was acquired (e.g., with premarital funds versus marital funds), whether marital funds were used to maintain the property, and other considerations in determining each spouse’s equitable interest in the property. If the home was purchased during the marriage with marital funds, it is generally treated as marital property.
When navigating a divorce, you should understand your rights to equitable distribution. To explore your legal options, contact the experienced divorce lawyers at Snyder Kenney & Mercado LLC. Our experienced and compassionate legal team will help protect what is yours. Call us at 908-574-3081 or complete our online form today for a confidential consultation. We have offices in Parsippany, NJ, and serve clients in the surrounding area.