Five Options for the Joint Property
In a divorce, you generally have several paths open to you – from a joint property sale to renting. Which option is right depends on your personal situation, financing, and the agreement of both partners.
Sale and Division of Proceeds
The most common and often cleanest solution: The property is sold, the loan is paid off, and the remaining proceeds are divided according to ownership shares. Both partners get a clear financial fresh start.
Takeover by One Partner
One partner takes over the property and buys out the other. Prerequisite: The bank must agree to the sole assumption of the loan, and the acquiring partner must be able to finance the buyout.
Joint Rental
Both partners keep the property as a capital investment and rent it out. This solution requires a functional relationship and clear agreements on management and costs.
Transfer to Children
The property is transferred to joint children – often in combination with a usufructuary right or right of residence. Tax aspects and the security of both parents must be carefully examined.
Partition Auction
If no agreement is possible, either partner can apply for a partition auction at the local court. The result is usually significantly below the market value – this path should only be chosen as a last resort.
Equalization of Gains and Property Value
In the statutory property regime of the community of accrued gains, the gains of both partners are compared during the divorce. The property is included in the calculation at its current market value – minus existing liabilities such as the remaining debt. A professional property valuation is therefore essential not only for the sale but also for the equalization of gains.
The effective date for the valuation is the day the divorce petition is served. Also, keep in mind that during the sale, additional ancillary costs such as broker commission and possibly a speculation tax may arise, which reduce the net proceeds.
Sale During the Separation Year
The separation year is legally required and serves as a period of reflection. A sale of the property is possible during this time but requires the <strong style={{ color: c.textPrimary, fontWeight: 500 }}>consent of both spouses</strong>. If one partner refuses, the sale can only be completed after the divorce is legally final. The partner remaining in the property has a primary right of use for the duration of the separation year.
Ongoing Loan: What to Do with the Financing?
A joint loan agreement remains unaffected by the divorce. Both partners continue to be <strong style={{ color: c.textPrimary, fontWeight: 500 }}>jointly and severally liable</strong> to the bank. This means the bank can demand the full installment amount from either partner, regardless of internal agreements.
When the property is sold, the remaining debt is paid off from the sales proceeds. A <strong style={{ color: c.textPrimary, fontWeight: 500 }}>prepayment penalty</strong> may be incurred if the loan is paid off early. These costs should be taken into account when planning the sales proceeds.
Frequently Asked Questions about Divorce Property
Can I sell the house during the year of separation?
In principle, yes, but only with the consent of both spouses. During the year of separation, the partner remaining in the property has a right of use. A sale is possible if both parties agree.
What happens to the joint loan in case of divorce?
The loan agreement continues to exist regardless of the divorce. Both borrowers remain jointly and severally liable to the bank. When the property is sold, the loan is paid off from the proceeds. If one partner takes over the loan, the bank must agree to release the other from liability.
Does the property have to be sold in a divorce?
No. A sale is just one of several options. Alternatives include one partner taking over the property and buying the other out, joint rental, or transferring it to joint children. Only if no agreement can be reached does a partition auction remain.
How is the equalization of accrued gains calculated for a property?
The property is valued at its current market value. The accrued gain is the difference between the assets at the time of marriage and at the time the divorce petition is served. Whoever has achieved a higher gain must compensate for half of the difference.
Enes Gülcan
Immobilienexperte & Gründer von Nordhall Immobilien
Ich begleite Eigentümer in Augsburg persönlich beim Verkauf ihrer Immobilie – diskret, strukturiert und mit dem Anspruch, für Sie das bestmögliche Ergebnis zu erzielen.
— Enes Gülcan