For most couples, the family home is their largest asset and may have sentimental value. When a marriage ends, there are multiple choices for deciding on the fate of the home. The right path depends on each family’s financial resources and needs.

In Arizona, property acquired during marriage is generally presumed to be community property, legally belonging to both spouses. A home purchased before marriage may be separate property but all or part of it can become marital property through commingling. To the extent it is marital in nature, each spouse is entitled to a share upon divorce. However, division of the asset is not the only option.

Here are the possible paths that divorcing spouses can take:

1. One spouse keeps the home — One spouse buys out the other's share of the home’s equity. This approach works best when the buying spouse can afford mortgage payments, taxes and maintenance alone, or when it’s beneficial for the couple’s children to remain in the home.

2. Sell the home and split the proceeds — This route is best when neither spouse can afford the house solo or when the equity is needed for financial fresh starts. A downside is that a soft real estate market and/or a large mortgage debt might make selling the house a losing proposition.

3. Trading assets — One spouse keeps the home and the other receives assets of comparable value, such as retirement accounts or vehicles. This option fits when there are enough assets to balance the scales. However, it’s vital to ensure the trade is fair and account for tax liabilities.

4. Deferred sale — Both spouses remain co-owners temporarily, allowing the primary caregiver to live in the home until children reach a certain age or another agreed milestone. This can provide stability for kids or buy time if the market is slow, but it requires an agreement on shared costs.

5. Renting out the home — Converting the home into rental property can bring income and avoid selling in an unfavorable sale market. This setup works if the rental market is healthy and both spouses are comfortable as co-owners and landlords. However, managing tenants, navigating tax implications and dealing with the complexities of joint ownership can pose challenges.

In deciding on the best option, you should consider current and future affordability, children’s stability, mortgage and refinancing realities, potential tax consequences and your long-term financial plan. An experienced property division attorney can clarify the home’s legal status, bring in appraisers and financial experts, draft protective agreements and ensure the path you choose serves your interests.

Clark & Schloss Family Law, P.C. in Scottsdale, Arizona represents people throughout Maricopa County in all aspects of divorce proceedings. Contact us online or call 602-789-3497 for a consultation.