How do couples properly value a home during a divorce?
Property division can take a long time to negotiate during a Colorado divorce. The longer spouses have stayed married, the more assets they likely own jointly and have to account for as they separate their lives. Spouses want to ensure they receive their fair share of the marital estate so that they can begin rebuilding their lives after the divorce.
In some cases, people can divide certain assets in half. Other times, they need to consider the value of certain belongings when dividing other assets. When it comes to real property, usually only one spouse retains the home, although spouses can also agree to sell the property and share the proceeds of the sale. The value set for the home will therefore have a major impact on other property division matters.
How do divorcing couples determine what a property is worth?
They need a current fair market value
What someone may have paid for a property years ago is probably no longer an accurate reflection of what that home is worth if someone were to list it on the modern real estate market. Therefore, neither the principal balance on the mortgage nor the assessed value for taxes is likely to be an accurate estimate for the purposes of property division.
Many divorcing couples choose to work with a professional appraiser to establish the current market value of their homes. A fresh appraisal can help people understand what their house would be worth on the current market and can provide figures that help with property division negotiations or when preparing for family court. Other people may ask for an estimated value from a licensed real estate agent, who will set a price based on the sale price of comparable properties in recent weeks.
Establishing the value of the largest marital assets will be an important step for those preparing for an upcoming divorce.