Divorce and Home Renovations

It’s not uncommon for couples to decide to divorce amidst home renovations. In fact, the pressure and stress that sometimes accompany remodeling can actually exacerbate a troubled marriage enough to cause the couple to decide to finally split.

But what do you do with the renovations? Who will pay to finish them? This is a very complicated situation that requires a team of legal and financial experts who can negotiate effectively to ensure the house is completed and costs are fairly distributed.

Several factors are at play when determining how renovation costs are divided or whether both spouses need to continue covering expenses after separation. For instance:

• Are the renovations being paid for with a home equity loan, a line of credit, or another type of loan? If so, who signed the loan?
• Are the renovations being paid for with marital funds, including credit cards or cash?
• Will the renovations benefit one spouse more than the other, or are you renovating shared space? For example, are the renovations for a game room, spa, kitchen, family room, or home office?
• Will one spouse keep the family home, or will the house be sold and the profit split equitably?
• Will the renovations improve the value of the home? They don’t always. Surprisingly, an inground pool adds less value to the home than it costs, but a new roof adds more value than it costs.
• Is one spouse’s income potential significantly lower than the other spouse’s?

If you’ve just filed for divorce, it’s wise to put a halt to the renovations temporarily until some agreement can be reached regarding completion of the project and repayment. Renovations typically run 10-20% over budget, so it’s important to make potentially difficult decisions about how much work actually needs to be completed to determine the home’s value for the division of assets.

If you try to complete the renovations yourself before we get a court order or a payment agreement from your spouse, you may not be reimbursed for your expenses. However, if a renovation must be completed in order to make the home livable – like finishing a partially exposed roof or completing the plumbing – you may need to pay for it without a prior agreement. Keep thorough records of expenses, and we will petition the court to recognize it as an essential expense for marital property, and therefore the cost should be equitably shared between spouses.

At Karen Ann Ulmer P.C. Attorneys at Law, we work with financial and real estate experts when renovations are involved and will vigorously represent you in court to ensure that you’re not stuck with the bill. Request a confidential consultation today by calling (866) 349-4721 so we can get started right away.