Why You Should Keep Your Family Home When Divorcing Late In Life
Real estate property is always considered a gem of an asset, those who are divorcing should not automatically fight to keep their primary residence. Multiple factors, such as the ability to afford and maintain the home, come into play. The exception is if you are divorcing in your sunset years; in such a case, you stand to gain a lot by keeping the marital home. Here are some of those potential gains:
You May Be Exempt From Real Estate Property Tax
Property tax is one of the reasons some people don't like keeping real estate property after a divorce. However, if you are divorcing late in life, there is a chance that you may enjoy property tax exemptions. States have different prerequisites for these exemptions, but advanced age is usually one of them. For example, New York State will grant you a tax exemption of up to 50% of the applicable property taxes if you are at least 65 years old and meet other applicable requirements.
You May Be Eligible For A Reverse Mortgage
If you have built up considerable equity in the home, then you may be able to enjoy a reverse mortgage from it to supplement your finances. A reverse mortgage is a financial agreement where you exchange your home equity for regular finances. Age is one of the typical requirements for reverse mortgage qualification; for example, you must be at least 62 years old to qualify for the reverse mortgage offered by the Federal Housing Administration.
It Is a Potential Source of Income
Even if you don't qualify for or apply for a reverse mortgage, there are other ways in which your home can make you money. The obvious one that comes to mind is that of rental income. You can rent part of the house or the whole house (and move to a smaller home) for some extra income.
Primary Residence Receives Special Treatment during Public Benefits Qualification
Qualification for public benefit programs is usually pegged on an applicant's ability or lack of ability to afford the services afforded by the benefits. For practical purposes, this means the government will scrutinize your finances and assets to determine whether it should award you the benefits. However, your primary residence will probably not be factored in the assessment, which means it won't affect your chances of qualification. This may not be the case if you accept other properties in lieu of your primary home.
A divorce law professional will be able to help you achieve your objectives whether or not you want to fight for the marital home. Consult one as early as possible in your divorce.
