"So many couples have been living together and biding their time," Orlando lawyer Leigh Sigman said. "I know many people who have coasted for years and touched base with me periodically - until they got equity in their homes."
Before the 2007-09 recession, couples who divorced vied first for the children and then for the real estate assets, Sigman said. But once the economic downturn stripped houses of half their value, the one-time happy abode became the hot potato that no one wanted in a divorce because it came with a mountain of mortgage debt - "worse than credit cards," Sigman said.
For better, for worse - or at least until the house can sell for a profit?
Local lawyers and real estate agents say what's happening is obvious: After years of slumping business, things have picked up now that home values have improved.
Stan Humphries, chief economist for the Seattle-based real estate-research firm Zillow Inc., said a decrease in the percentage of underwater homes has allowed more homeowners to sell at a profit, so they can finally relocate to other parts of the country, and has allowed more couples to make marital decisions without worrying about a distress sale ruining their credit.
"They can now sell, liquidate their assets and go their separate ways," said Humphries, who was in Baltimore this week meeting with groups of real estate agents.
The number of "underwater" homes - properties worth less than their mortgage balance - has declined from 54 percent of all mortgaged houses in the fall of 2011 to 41 percent as of July of this year, according to Zillow, which has been tracking negative equity in U.S. markets for about two years.
Some real estate agents say the drop in homes with negative equity has spurred their business with both divorcing couples and divorcees.
Getting even a little equity out of a house sale helps cover what can be some pretty hefty costs to get restarted with a new downpayment or apartment deposits. Even though it's an unhappy time for couples, the formation of new households helps spur the local economy as newly single consumers purchase furniture, utilities and other services, he added.
Home-sale profits may not be the only real estate transaction affecting a couple's relationships.
Just last week a woman commented that she was able to transition out of a marriage that no longer made sense when Bank of America agreed to modify her monthly mortgage payment from a high of $2,200 a month to about $1,400, which was an amount she could begin to afford on her own.
Many lawyers assert that the main issue is that couples sometimes stay together simply because they don't have enough money to leave each other.
The recent surge in divorces, although an unhappy experience, is a good indication that home values across the nation are continuing to go up.
Originally Posted by Matthew T Smoot
Originally Re-Posted by Lisa VanderLoo on 10/24/2013