The house can quickly become one of the biggest points of conflict in a divorce.
You might both agree that selling now makes sense.
But you might disagree on when to sell, the listing price, or how to divide the proceeds.
And one spouse may want to sell while the other wants to stay.
A pending divorce doesn’t prevent you from selling the house.
But there’s a lot more you need to know than just how to put the home up for sale.
Court orders, settlement negotiations, mortgage obligations, and state law can all affect the process.
This guide explains the options you have and what happens if you and your spouse can’t agree on a sale.
You’ll also learn how to sell during the divorce process and what to consider when deciding whether to sell before or after the divorce is final.
Can you sell a house during a divorce?
Yes, you can sell a house before the divorce is final, including before a settlement is reached.
The real issue is whether you and your spouse can agree on the sale or whether the court has to step in.
Your ability to sell the home can also depend on any court orders already in place and the laws in your state.
What if one spouse wants to sell and the other doesn’t?
The spouse who doesn’t want to sell may be able to stop the other spouse from selling.
That can be true even if only one person is on the title.
If your spouse objects, try to resolve the disagreement with each other first.
Putting real numbers behind why you want to sell can help get your soon-to-be-ex on the same page.
For example, your spouse may want to stay because they don’t want to move or are concerned about finding another place to live.
If so, put two numbers on paper: what they would need to pay for your share of the equity and what the home would cost them each month.
Ask them to show how they could cover both.
If the numbers don’t work, you’ll have a stronger financial argument for selling.
You can work through your attorneys or use mediation if you’re still unable to agree.
Can a court order the house to be sold?
Yes, a judge can order a house to be sold during a divorce.
But asking the court to order a sale doesn’t guarantee that will be the result.
Depending on the circumstances, a judge could decide that one spouse should keep the home instead.
A court order to sell a home can include specific terms.
An order might address when the home must be listed, how the real estate agent should be chosen, and how the listing price will be set.
Talk with your attorney about making the order specific if you’re asking the court to order the sale.
You want to make sure it covers the decisions that could otherwise create another dispute later.
Is it better to sell the house before or after the divorce is final?
There isn’t one answer that works for every couple.
Selling before the divorce is final can make sense if you’re both ready to move on from the house and want to stop dealing with it as a shared asset.
You’ll have fewer decisions to make later and won’t have to deal with the property after the divorce is over.
Waiting can make more sense if the terms of your divorce are still being worked out or one of you needs more time before the house is sold.
But putting the sale on hold has a cost.
You need to know what you would spend to keep the home during that time and compare it with what you think you might gain by waiting.
For example, waiting six months for a potentially higher selling price might not help if the additional carrying costs eat up most of the difference.
The numbers shouldn’t be your only consideration.
Think about where each of you will live and how well you can continue making decisions about the property together.
More importantly, think about whether keeping the house longer will make things easier or create more conflict.
Taxes can also affect the timing, but don’t assume you need to sell before the divorce is official just to preserve a tax break.
The home-sale exclusion has special rules for divorced and separated taxpayers, which we’ll cover below.
What happens to the mortgage, expenses, and sale proceeds?
Deciding to sell doesn’t settle the money issues tied to the house.
You still need to know who covers the bills until closing and how the proceeds will be handled afterward.
Who pays the mortgage and other expenses while the divorce is pending?
The mortgage doesn’t stop just because one of you filed for divorce.
If both of you are on the loan, you’re both still responsible to the lender until the mortgage is paid off or refinanced, or one spouse is formally released from the debt.
Who actually makes the payments while the divorce is pending is a separate issue.
You and your spouse can agree on who pays the mortgage, property taxes, insurance, HOA dues, utilities, and repairs.
If you can’t agree, the court can issue temporary orders that spell out who is responsible for certain expenses while the divorce is ongoing.
Moving out doesn’t automatically remove your responsibility either.
If both names are still on the mortgage, a late payment can hurt both of your credit scores.
Whatever arrangement you use, put it in writing.
Spell out who pays what, when payments are due, how each of you can confirm they were made, and who pays for unexpected repairs.
And keep proof of every payment.
Those records can matter later when the property and finances are divided.
How are the proceeds from the sale handled?
Depending on the state, a title company, escrow company, or closing attorney may handle the closing.
Make sure whoever is managing the proceeds has the written instructions and any divorce agreement or court order that governs how to distribute them.
The distribution should be crystal clear before closing.
If you’ve already agreed on the split, whoever is handling the closing can distribute each spouse’s share separately.
But if the divorce is still pending and you haven’t resolved who gets what, some or all of the proceeds may need to remain undistributed until you reach an agreement or the court decides.
Ask to review the closing statement before you sign the final documents.
Make sure the expected payoffs and costs are correct and that everyone understands how you’ll divide the proceeds.
The last thing you want is a new dispute over the money after you’ve already sold the house.
Tax implications of selling a house during divorce
Many sellers going through a divorce want to know whether they’ll have to pay taxes on the profit from the sale.
The IRS refers to that profit as your gain and allows qualifying homeowners to exclude some of it from their taxable income.
A married couple filing a joint tax return can qualify to exclude up to $500,000.
But selling the house while you’re still married doesn’t automatically mean you’ll get the full $500,000 exclusion.
Generally, at least one spouse must have owned the home for two of the five years before the sale.
And both spouses must have lived in it as their main home for at least two of those years.
Neither spouse can have used the exclusion on another home sale during the previous two years.
The timing of your divorce is another factor.
For tax filing purposes, the IRS generally looks at whether you’re married on the last day of the year.
If your divorce is complete by December 31, you generally can’t file a joint return with your former spouse for that year.
But waiting until after the divorce is final doesn’t automatically mean you’ll lose the home-sale exclusion.
So don’t assume you need to close before the divorce is finished just to preserve the tax break.
How to sell a house during a divorce
The real estate side of the transaction doesn’t change much because you’re divorcing.
Most of the usual steps to selling a house still apply.
Here’s how to handle the parts that can get more complicated during a divorce.
1. Review your agreements and court orders
You need to know whether any agreement or court order limits when you can sell the home or requires your spouse’s consent.
Look for details about the listing price, choosing an agent, who pays expenses before closing, and what happens to the proceeds.
Don’t rely on what you remember agreeing to during negotiations.
Read the actual language.
If anything is unclear, have your divorce attorney explain it before you sign a listing agreement or accept an offer.
And make sure your real estate agent and whoever is handling the closing also know about any terms that affect the transaction.
It’s much easier to deal with a restriction before you list the house than after you’re under contract.
2. Agree on how you’ll handle the sale
Getting on the same page before you list the house can prevent disagreements from slowing down the sale.
Here are several potential sticking points to work through.
Listing Price: Agree on how the initial price will be set. If you can’t agree on a number, decide ahead of time whether you’ll rely on your agent’s recommendation or get an appraisal.
Timing: Decide when the home will be listed. Take into account any deadlines in your divorce case, moving plans, or other commitments that could affect when the house is ready to sell.
Handling an Offer: Agree on how you’ll evaluate an offer and how quickly each of you needs to respond. Decide ahead of time what price and terms you’d both be comfortable accepting.
Staging and Repairs: Decide how much you’re willing to spend getting the home ready for sale. You can also set a dollar amount that neither spouse can exceed without the other’s approval.
Living Arrangements: If one of you is still living in the home, agree on how showings, open houses, and access for the agent will work.
And decide how you’ll break a tie if you disagree on one of these decisions.
3. Choose a real estate agent
A divorce sale can get more complicated if one spouse thinks the agent is favoring the other.
So both of you should feel comfortable with the listing agent you hire.
Look for someone who can communicate with both of you, document important decisions, and stay out of disputes that belong with your attorneys.
Experience with divorce sales is worth asking about.
Add this to your list of questions to ask a Realtor: “How many sales involving divorcing sellers have you handled, and how do you manage communication when the spouses disagree?”
Pay attention to how they answer.
You want to hear that both spouses will receive the same important updates and that the agent will confirm key decisions in writing.
They should also know when a legal question needs to go back to your attorneys instead of trying to interpret an agreement or court order themselves.
Divorce experience shouldn’t outweigh the other qualifications that matter when choosing a Realtor to sell your home.
You still want someone with recent listing experience in your market, good seller reviews, and a history of successfully selling homes like yours.
The agent should handle the real estate side of the transaction.
Legal disagreements between you and your spouse should stay with your attorneys.
4. Prepare, price, and list the home
You don’t need to spend money on every possible repair or improvement before listing.
Have your agent point out what’s worth doing and what you can skip.
Our guide to getting your house ready to sell goes deeper into the preparation process.
Pricing can be a little trickier during a divorce.
One spouse might want to push the price higher because they need a certain amount from the sale.
The other might want to lower the price to sell the house faster.
Neither should determine the asking price.
Your agent should use recent comparable sales, competing listings, and current buyer demand to recommend a price.
Have them prepare a seller net sheet at that price too.
Seeing the estimated proceeds can make it easier for both of you to evaluate the recommendation using the same numbers.
And keep the divorce out of the marketing.
The reason you’re selling doesn’t need to become part of the property’s story.
Signaling that you’re under pressure to sell can encourage buyers to test how flexible you are on price.
Keep the focus on the house instead.
5. Agree on an offer and complete the sale
Don’t judge an offer by the price alone.
Look at the buyer’s financing, contingencies, requested credits, closing date, and any terms that could make the deal more difficult to complete.
A slightly lower offer may be the better choice if it comes with fewer contingencies or fits a deadline in your divorce.
Pay attention to concessions too.
A higher purchase price can lose some of its advantage if the buyer is asking for a large credit or other costly terms.
If you already agreed on the price and terms you’d be comfortable accepting, compare the offer with what you agreed on.
And if you and your spouse see it differently, have your agent walk both of you through the tradeoffs before either person responds.
Before closing, confirm the move-out date, when the buyer gets possession, what you need to remove from the home, and how you and your spouse will sign the closing documents.
One spouse delaying a signature or missing an agreed-upon deadline can create problems when you’re already close to the finish line.
If you haven’t chosen an agent yet, we can help.
Our free service can match you with a qualified local agent who has experience working with divorcing sellers.
Learn more about how our agent matching works.
