Can I Purchase A Home While Going Through A Divorce?

A common question when parties are separating into two households is what should they do in regard to finding a new place to live. Divorcing spouses like to know if they have the option to purchase a home rather than rent a home. This question is tricky because the answer to this can vary based upon the state a person resides in as well as how far along they are in the divorce process. For purposes of this article, we are discussing the rules regarding purchasing a home in Illinois during a divorce.

Will my spouse be entitled to 50% of a home purchased during the divorce proceedings?

Property Division Under Illinois Law

Examples of Equitable Distribution in a Chicago Divorce

Or, say someone has a job earning significantly more than the other. The spouse who is at a disadvantage may be entitled to a larger distribution of marital property (perhaps 55% or 60% or even more) based upon these factors.

Key Considerations if You Purchase a Home in the Divorce Process

What if we agree that I can buy a home while the divorce is pending?

How do I know what I would have to pay my spouse if I do purchase a home during divorce proceedings?

So, for example, if you put down twenty percent to purchase a home at a purchase price of $200,000, so, $40,000, and the rest of the purchase is through a mortgage, you only put out $40,000 in marital monies to buy it. If the house’s value has not increased from the date of purchase to the date of divorce, then you’d pay your spouse whatever percentage of the $40,000 the Judge decides is equitable. It could be 50%, or $20,000, or it could be more or less. And, you can propose offsetting this sum with other assets, such as offering to take $20,000 less money from a joint savings account since you owe your spouse $20,000 from the home purchase anyway.

One issue which could arise is the house could increase in value from the date of the purchase to the date of the divorce. Let’s say using the same math that the house was purchase at $200,000 but now is worth $230,000 at the time of divorce. This property is marital, gains are also marital. So, now you’d owe your spouse a percentage of the equity in the home at the current price. If you put $40,000 down, plus there is now an extra $30,000 in equity, there is now $70,000 that has to be divided between the two of you, and you’d, in theory, have to buy your spouse out of their percentage of the $70,000. Perhaps your estate has other assets you could use to offset this additional equity. But, if it does not, you could be forced to sell the home in order to pay your spouse their share of the full equity. So, purchasing it for the purpose of living in it was all for nothing (except you did obtain some additional cash!).

Purchasing a home during a divorce is tricky and there are plenty of unique factors that have to be considered in every situation. No divorce case is the same and no scenario is the same, so if you are considering purchasing a home during divorce proceedings it is imperative that you speak to an experienced divorce attorney regarding the unintended consequences of this purchase and ways in which it can be done which would benefit you.


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