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How to Manage a Court-Ordered House Sale During a Divorce

How to Manage a Court-Ordered House Sale During a Divorce
court ordered sale of house in divorce

When the court orders the sale of a home in Tennessee following a divorce, it must be for a “fair market value” and performed within a reasonable time to ensure that the owed parties receive what the court determines they are entitled to. However, this process can take a significant amount of time, with properties often remaining on the market for several months before they are sold.

Is there a way to ensure that a court-ordered sale of a house in a divorce resolves with far less difficulty?

Below, we outline several key court decisions you may encounter. We also offer some advice on how to complete the home sale more quickly, should you simply want to get the process over and done with in the shortest time possible. So, read on to learn what WeBuyHouses.com in Memphis can do for you.

The Process for a Court-Ordered Sale of a House in a Divorce

The process of divorce property division can be complex. However, should the issue go to court, the judge has several options available. One of the primary ones is equitable distribution, as outlined in Tennessee’s laws.

If spouses reach a stalemate, with both wanting to retain the rights to the marital home, the judge may instead order them to sell the house in the divorce, sharing the proceeds between them

When this occurs, the court clerk will record the order. They will freeze options such as refinancing or title changes until the proceeds from the court-ordered real estate sale are distributed between the spouses. The court will also often appoint a realtor if the spouses cannot agree on one, or otherwise approve one of the parties’ suggestions as the one to move forward with.

If the couple fails to meet court deadlines regarding this sale, it could lead to larger problems, such as contempt penalties and additional legal fees, so taking the process seriously is imperative.

Understand the Court’s Sale Order

Speak with your attorney about the sale, but in general, it will spell out:

  • Listing price guidance
  • Recommendations or orders for agent selection
  • Details on how any offer must be presented
  • Who can stay in the home
  • Which person should pay the utilities
  • Necessary repairs

When the sale is made, the order should also inform the pair how their funds will be allocated, including the use of an escrow account.

Marketing and Accepting Offers

Parties can still appeal this decision within thirty days. If there is no appeal, then marketing the home must commence within the period specified in the order. While this typically ranges from two to four weeks, it may be longer, depending on various factors, including the order being placed around the holidays.

Once the home is on the market, the seller must make all reasonable attempts to accept an offer befitting the court order. The order may mention specific prices below which the pair cannot sell the home, or above which the pair cannot demand. Doing this ensures swift sales and helps avoid stonewalling.

If delays occur, these should be well-documented to prevent them from escalating. 

How the Court Determines Your Home’s Value

As part of the legal house sale process, the courts may rely on licensed appraisers or brokers to provide a price for the home and to establish a listing baseline. This value is likely to appear in the court order, preventing the home from being sold at an unfair rate to either party.

At the same time, each spouse may choose to submit an independent appraisal of the location. The court may decide what to do with these as it wishes. It may:

  • Average them
  • Choose one as the more credible
  • Ignore them
  • Take them into consideration

However, be aware that such independent appraisals may cost money to resolve. So, if possible, inquire if such a step is likely to have an impact on the court’s decisions.

Additionally, please note that any major repairs that have not yet been completed may affect this appraisal. However, the assumed final valuation, including repairs or renovations, may be used if closing funds are withheld from the proceeds. Either the courts may do this, or it may often occur through a mutual agreement accepted by both parties.

While this appraisal may seem limiting, it is essential to note that if an “as-is” cash offer exceeds the appraisal value, the judge may waive any prior appraisal and order it accepted.

Final Transfer of Funds

Once the transaction is complete, the court will review the documents to confirm all steps have been taken correctly, including resolving:

  • Liens
  • Taxes
  • Commissions
  • Fees

The court may also deduct a portion of the cost for expenses such as child support and attorney fees. After this, the funds will be distributed between the parties via a certified check or wire transfer. 

You may still appeal this decision and the closing statement. However, the timeline to do so is much shorter.

Know Your Rights Before and After the Order

While such a sale is a dramatic step, you do not suddenly lose all rights involved in the sale. You will retain the capability to look at things like:

  • Offers
  • Counter-offers
  • Inspection reports
  • Sale reports

During the sale, you will also not necessarily be removed from the home. Depending on the nature of the separation, one spouse may be required to vacate the premises as part of the separation order.

However, this is not always the case. In general, if one of the spouses is deemed the primary custodial parent, they will often be the ones allowed to stay in the house, thereby offering the child a degree of stability in both home and school.

Whoever stays in the home is then likely to be the one who continues to pay ongoing utilities and is expected to maintain the building. However, extraneous circumstances may cause that decision to change, such as one parent not having the means to do so.

The spouse who remains in the home must ensure that it is maintained in a condition that would be suitable for showing to potential buyers. They must also allow showings with reasonable notice, usually 24 hours, but the courts may require real estate agent supervision during these.

Reasonable move-out windows are prevalent, however, to give you time to search for a moving company and handle your property. However, following a divorce, make sure that you respect any orders related to the separation of any other property to avoid causing issues with the court.

If a minor child is involved in the divorce, this will often be taken into account during the sale, and you may be given additional time to find a stable housing situation for them, depending on the court’s decision.

How Does the Share of Proceeds Work?

It is essential to note that the split adheres to Tennessee’s equitable distribution guidelines. These do not mandate an equal split. Instead, the courts will determine which partner made the greater contribution towards ownership of the home, and they may be entitled to additional funds.

If the mortgage for the home is not entirely paid for, however, then that should follow the same rules. The courts will ensure the loan is paid at the closing of the house, and the remaining funds will then be transferred to the spouses.

Cash Exit Through WeBuyHouses.com

If the court order allows it, you could consider a cash-in-hand home buying service to expedite the process and minimize any difficulties. Businesses like WeBuyHouses.com can help you transition from a court order to a complete sale in just a few weeks, offering a speedy resolution and a home sale offer in any condition.

These sales also mean there are fewer fees and that one does not need to worry about resolving issues such as:

  • Repairs
  • Renovations
  • Staging
  • Agent selection

Instead, the costs are dramatically cut, and the closing date of the sale can come much faster.

WeBuyHouses.com is also well-versed in this process and can help you with every step, including assisting with the moving-out process if necessary. We have teams on hand to ensure that you can move out on a date that suits your needs and aligns with any court order you may have.

We will even communicate with the court, ensuring that every “t” is crossed and “i” is dotted, reducing the amount of paperwork you need to worry about.

With WeBuyHouses.com, you can get past the difficulties of a divorce and onto a fresh start, safe in the knowledge that we have taken care of everything in your old home.

Close the Book on Your Divorce Home and Move Forward

Strict court orders can be hard to follow and very stressful. As such, a court-ordered sale of a house in a divorce may lead you to seek out assistance, helping you navigate the worst of it. WeBuyHouses.com can help with that, ensuring that any sale of your home happens quickly, fairly, and without fuss.

We can deliver a cash exit with no repairs and no showings. So, request a cash offer on your marital home today and get the money you need to walk away easier.

Picture of Peyton Clark

Peyton Clark

Peyton Clark is a real estate professional and author based in Memphis, TN. He helps homeowners to sell their homes fast for cash, and frequently writes on topics related to home selling and real estate investing.
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