Just thank your lucky stars that there are no kids involved, it’s just money. With regards to your comment about not knowing if your spouse will have to pay her share of the mortgage until the market turns around, the answer is NO! Get an honest appraisal from a real appraiser not a realtor, and if you can avoid getting a lawyer (by that I mean she doesn’t get one either) then use a paralegal, draft a marriage settlement agreement, and divide the assets. The diference between the appraisal and the loan is the value of that asset, lets say it has a value of 100k and you have another asset worth 100k, you each take one. It is better to refi and remove the other party’s name from the loan or get your lender to remove it which they probably won’t so you are stuck with a refi. You can buy her out or she can buy you out if the house has equity and that is all there is. I know at least 20 people who have gone through a divorce in recent years and not one person who bought the other out and kept the house is happy with their decision (including very recent ones) for quite a few it has been their undoing. My actual advice, list it yesterday for an agressive 20-50k below any recent comp, make it go away, divide the cash, get the divorce done sooner than the end of the year and start over. Go rent for a year or two and then buy back in when the market is worse. If you buy her out you are doing nothing more than buying today and I don’t think anyone here would advise you to do that in your area right now. Another tip, if you don’t sell, the appraisal you get today is worthless in 60 days, don’t base the MSA on an appraisal unless the ink on it is still wet.
