If you and your spouse are contemplating divorce, it’s
important for you both to understand that when it comes to real estate, the
process can be fraught with complicated questions and scenarios. Colorado is a
marital property state, meaning that any joint property of the couple will be
equitably divided during the divorce. Equitable
division is not necessarily equal division, as the court will consider the
economic circumstances and the earning potential of both spouses when it makes
the division.
When it comes to real estate, there are a few things to keep
in mind as you work through your divorce, namely, understanding the value of
what you’re dividing. After determining which property is marital property, the
couple, or the court, will assign a monetary value to each item. If you need
help determining values, you and your soon-to-be-ex should consider hiring
professional appraisers.
Here are a few things to know about dealing with real estate
appraisals:
1.
Most real estate values are based on comparable
sales in your area.
2.
Every appraiser will have his or her own
evaluation style, meaning there can sometimes be big differences in the values
they provide (e.g., one appraiser may focus on the value of external
landscaping, while another will focus on interior improvements).
3.
Real estate values can change drastically
depending on the market, so the equity you have in a home may not directly
translate to a profit if the real estate market isn’t strong.
4.
And don’t forget that an appraisal is only part
of the story; to quantify your equity in the home, you’ll need to take the
appraisal value and subtract any mortgages or liens that are on the home.
If you’d like to learn more, here’s
an article from Forbes Magazine. You should also have a list of questions
for your attorney as you navigate this process.
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