When couples divorce in Tennessee, one of the most emotionally charged and financially significant issues involves what happens to the family home. Deciding whether to sell, keep, or refinance the property requires a clear understanding of Tennessee’s property division laws and your personal financial situation.

Understanding Property Division in Tennessee

Tennessee follows equitable distribution laws, meaning marital assets are divided fairly but not always equally. The family home is typically considered marital property if it was purchased or paid for during the marriage. However, if one spouse owned the home before marriage or inherited it, part of its value may still be treated as separate property—especially if marital funds or efforts contributed to its upkeep or appreciation.

Option 1: Selling the Home

Selling the home is often the simplest option. The proceeds can be used to pay off the mortgage and then split between the spouses according to the court’s determination or mutual agreement. This route provides both parties with a clean financial break and may help prevent ongoing disputes about property maintenance or market value changes.

Option 2: One Spouse Keeps the Home

If one spouse wishes to remain in the home—perhaps to provide stability for children—they may need to buy out the other spouse’s share. This requires a property appraisal to determine fair market value. The buyout can be achieved through cash payment, trading other marital assets, or adjusting alimony or debt division accordingly.

Option 3: Refinancing the Home

Refinancing can help one spouse keep the home while removing the other spouse’s name from the mortgage. This ensures financial independence and protects both parties’ credit. The spouse keeping the home must qualify for the new mortgage based on their individual income and credit history, which can sometimes be challenging after a divorce.

Key Considerations

• Emotional ties: The family home often carries deep sentimental value, but decisions should be guided by long-term financial security.
• Children’s needs: Courts may consider stability for minor children when deciding whether a spouse should keep the home.
• Tax implications: Selling or refinancing can have tax consequences, so professional guidance is essential.

At Law Offices of Crystal Etue, PLLC, we can provide legal assistance to the Franklin public navigating property division and other divorce-related matters. Our team can help you evaluate your options and protect your financial future throughout the process.