Taking steps to go through with a divorce can be overwhelming. Knowing what steps to take in a divorce settlement can help. Selling a family home can be traumatic to a family already dealing with divorce. You can keep your family home by buying out your spouse's share. Follow these steps to buy out home equity in a divorce.
Get an experienced lawyer that specializes in divorce settlements or division of home equity. A lawyer knows the various buy-out strategies and legal loopholes that may be needed.
Acquaint yourself with the home buy-out laws as pertains to divorce in your state. In some states you may obtain a "use and possession" award that entitles you to use the house and personal property for up to several years after a divorce.
Know that buying out a spouse's equity can be done in a number of ways. You might obtain a new mortgage in which you take enough cash out of the equity to pay off your spouse. If you have trouble qualifying for the loan, your spouse might agree to stay on your existing mortgage for a number of years or you might have a friend or relative willing to cosign for you on a new mortgage.
Realize that another option is to trade some other marital property in return for the equity in the home. For example, you could give up some share of your spouse's retirement money, a boat, a car or a vacation home in return for your spouse's share of the equity.
Note that another option is for the purchasing house to make payments to the selling spouse for a number of years. This option can be done by the having the purchasing spouse sign a promissory note to the selling spouse.