For many women going through divorce, the family home represents far more than an asset on a balance sheet.
It’s where you brought your children home from the hospital. The kitchen where everyone still gathers for the holidays. The neighbors you trust to watch the dog when you’re away. Keeping the house can feel like holding onto some stability when so much else is changing.
“The house is almost always about the kids,” says Monica Dwyer, Certified Financial Planner™ and Certified Divorce Financial Analyst® (CDFA®) at Harvest Financial Advisors. “Many of the women I work with want their kids to finish growing up in their childhood home, especially at a time when so much is changing.”
That desire is completely understandable. And the decision is more complex than taking on a mortgage payment.
Can you afford the home and still afford the future you want?
Can I afford to keep the house in divorce? Start by counting the cost.
The mortgage is only one part of homeownership. Property taxes, homeowners insurance, utilities, maintenance, landscaping, and repairs can increase the monthly cost considerably.
A 2025 analysis from Zillow and Thumbtack estimated that property taxes, homeowners insurance, and maintenance cost the typical U.S. homeowner nearly $16,000 a year, or about $1,325 per month beyond the mortgage. (Actual costs vary significantly depending on the home and location.)
Those expenses can feel very different when one household becomes two. A roof that needs replacing, a new HVAC system, rising property taxes, or ongoing landscaping costs may once have been absorbed by two incomes or a larger household budget. After divorce, you may be responsible for them yourself.
Joy Schlie, Certified Financial Planner™ and Certified Divorce Financial Analyst® (CDFA®) at Harvest, says keeping a house that becomes difficult to afford is one of the most common financial mistakes she sees after divorce.
Keeping the house in a divorce may change your mortgage
And then there’s the mortgage.
Monica and Joy have seen women with 10 years left on a mortgage consider refinancing into a new 30-year loan at a significantly higher interest rate.
Refinancing can mean a higher monthly payment, closing costs, and more years of debt. A 50-year-old woman with 10 years left on her mortgage faces a very different retirement if she refinances into a new 30-year loan (and is paying off her house at 80).
Ask your lender whether refinancing is required or whether assuming the existing mortgage may be an option.
The Consumer Financial Protection Bureau has warned that some homeowners who receive a home through divorce have been unnecessarily pushed toward refinancing. Depending on the loan and your circumstances, it may be an option for you to assume the existing mortgage. Ask a qualified lending professional about your options before a refinancing deadline is written into the divorce agreement.
Before refinancing the house after divorce, check the lending requirements
Say a woman needs spousal support income to qualify for a mortgage, and her divorce agreement requires her to refinance the family home within 60 days.
The timing may create a problem.
For certain conventional mortgages, Fannie Mae requires a minimum six-month history of full, regular, and timely support payments before that income can be used as qualifying income. The lender must generally also confirm that the income is expected to continue for at least three years.
That 60-day deadline could arrive before she has the payment history needed to qualify for the loan.
Certified Divorce Lending Professionals can identify lending requirements before refinancing deadlines are written into a final agreement, and they are not permitted in their industry to charge a fee for consultation.
Keeping the house vs. selling in divorce: Consider what you may be giving up
If you want to keep the house, what might you have to give up to get it?
Say you keep more of the home equity while your spouse keeps more of the retirement or investment assets.
Consider each asset’s current value and the role it could play in your financial future.
- A house provides a place to live and may appreciate over time. It also requires ongoing spending, and its value can’t be used to pay monthly expenses unless you sell the property or borrow against it. (And remember you need to have income in order to be able to show that you can pay off the loan.)
- Retirement and investment assets may provide money you can access, potential growth, or future retirement income.
- Taxes: In most cases, transferring a home between spouses as part of a divorce does not trigger a gain or loss for tax purposes. The spouse who keeps the home generally keeps its existing adjusted tax basis, too. That basis could affect the taxes owed when the home is eventually sold. That basis could affect the taxes owed when the home is eventually sold. As an individual, you have an allowance of $250,000 of gains in a home you have lived in at least two out of the last five years. However, should you decide to sell the home and split the proceeds, the capital gains allowance doubles to $500,000. Therefore, if the plan is to sell the home and split the proceeds, this needs to be properly written into the divorce decree for tax purposes if the home is sold post divorce.
How keeping the house after divorce could affect your retirement
The effects of this decision can extend for decades, which is why it’s important to thoughtfully consider:
- What will this house cost me each month?
- What major repairs or expenses could be coming soon?
- Will I need to refinance, and if so, can I qualify and when?
- What other assets would I give up to keep the house?
- Would I still be able to save enough for retirement?
- What would my finances look like if I sold the house instead?
- Can I maintain the house or afford to hire help to do so?
The answers are personal, as are the reasons you want to keep your home.
A Certified Divorce Financial Analyst can model different scenarios so you can see how each choice could affect your cash flow, retirement savings, and other financial priorities over time.
Questions we’re often asked about keeping the house in divorce
If my ex is leaving the house, does their name automatically come off the mortgage?
No. Your divorce agreement may say the house is yours and you are responsible for the mortgage, but the lender has its own rules. Your ex can remain legally responsible for the loan until the lender releases them. Before the agreement is final, find out exactly what your lender will require to put the mortgage in your name alone.
Monica shared, “A friend of mine decided to be nice and let her ex-husband keep a favorable loan on the house which he kept as part of their divorce. Her name was still on it. She found out years later that he had destroyed her credit by not making payments. The house went into foreclosure, and she didn’t know until it was too late.”
How do we decide what the house is worth?
The value of your house can also affect how much you or your spouse receives in other assets. An appraisal or another accepted valuation method can help establish fair market value.
Monica has seen this become a point of contention. In one case, a husband argued that the home’s value should be lower because he believed the housing market was inflated. A lower value would also have meant paying his wife less in other assets. Monica’s point was practical: if she needed to buy another home in that same market, she would be paying current market prices, so it was only fair that he pay her half of what the current value of the house was.
Agreeing to a fair price on the home is critical in determining how the rest of the assets are divided. If a couple cannot agree on a price for the house, they might opt to agree to hire an appraiser that they both approve of, and accept the price that appraiser comes up with.
What if I keep the house now and decide to sell it later?
Of course you can change your mind. But before you decide to keep the house, it’s worth understanding what a future sale could mean financially. The home’s tax basis generally carries over when property is transferred as part of a divorce, and that can affect the taxes you may owe when you eventually sell. Selling also comes with costs that can reduce how much of the home’s value ultimately ends up in your pocket.
Know what the house could be worth to you after taxes and selling costs, not just what it’s worth today.
Disclosure: Harvest Financial Advisors is a Registered Investment Adviser. This content is for informational purposes only and does not constitute a complete description of our investment services or personalized financial, tax, or legal advice. Divorce laws, tax consequences, Social Security rules, and individual financial circumstances vary. Consult with qualified legal, tax, and financial professionals regarding your specific situation before making financial or legal decisions.
Sources
- Fannie Mae: Alimony, Child Support, Equalization Payments, or Separate Maintenance. Current requirements for using support payments as qualifying mortgage income.
- Consumer Financial Protection Bureau: Homeowners Face Problems With Mortgage Companies After Divorce or Death of a Loved One. Mortgage assumptions, refinancing, and issues homeowners may encounter after divorce.
- IRS Publication 504: Divorced or Separated Individuals. Federal tax treatment of property transfers and property settlements related to divorce.
- Zillow Research: The Hidden Costs of Homeownership Top $16,000 a Year. 2025 Zillow/Thumbtack analysis of maintenance, homeowners insurance, and property-tax costs.
