Property division typically is one of the main sources of contention during the divorce process, because you might not agree on the value of the assets.
When you are trying to work toward a fair divorce settlement, it is important that you each agree on the value assigned to each asset. For example, if one of you wants to keep the main residence, the other must get something of equal value in exchange. There are several ways you can determine the value of your home. Below are three valuation methods.
Many couples choose to use the recommendation of a licensed appraiser for the value of the marital home. Real estate appraisals can cost several hundred dollars, depending on the real estate market in your area at the time you request the appraisal. However, hiring a licensed appraiser can make a huge difference in your divorce settlement.
Consider simply using the value of your home at the time you made the purchase. You take the house and your spouse walks away with the lion’s share of the retirement accounts. When you decide to sell the house, you find out it’s worth much less than what you originally paid, which means your ex definitely got the better deal. An appraisal can save you from unknowingly agreeing to a very lopsided and unfair divorce settlement.
Analysis of recent sales in the area
Some homeowners choose to use a Comparative Market Analysis (CMA) to determine the value of a home. You can typically hire a real estate agent to conduct a CMA for a reasonably low price. A CMA will look for homes that recently sold in the area that have very similar characteristics to your property and base a value on those numbers.
Unfortunately, a CMA does not always return accurate numbers. This is usually because such an analysis usually does not factor in certain things that might affect the value of your home, such as its condition.
Doing your own research might yield the results you want, but this is often the least accurate option when it comes to determining the value of a home. Also, in order to use a value you have researched yourself based on real estate listings, you and your spouse have to agree on the value. The court may not accept such research as accurate information and may insist you use a licensed appraiser or have a real estate agent conduct a CMA.
Determining the value of your home, or other high-value assets, is a very important step in working out a fair marital property settlement. If possible, choose a method that is accurate and reliable so that you can get the best possible outcome.