Real Estate

Going through a divorce is not easy, no matter what the circumstances. You have so much on your plate, not the least of which is buying a house during a divorce. It may feel overwhelming now, but a new home will help you move into the next chapter of your life. In Virginia, you must separate for 6 or 12 months, depending on your circumstances, so one of you has to move out (unless you establish an in-house separation arrangement). MMake it less stressful by working with an experienced agent and keeping a few things in mind as you search. (The information in this article is based on Virginia state law but should expressly not be construed as legal advice. You should be sure to consult with an attorney for help with your specific situation).

Avoid Using Marital Money

 Until your divorce is final, you want to be sure your new home will be considered your separate property. Any money you use when buying a house during a divorce, including the down payment, must be financed with your own money. That means you cannot use “marital property” to finance or pay for expense associated with the purchase.

Marital property is the property that was acquired or earned during the marriage or used for the benefit of the marriage or shared with the spouse. Separate property is the property that belongs only to one of the two spouses. Generally, separate property is property that belonged only to one spouse before marriage. It could also include some property given only to one spouse during the marriage, like an inheritance from a relative.

During a divorce, the most common types of marital property that will be divided are real property such as the family home, second homes, and personal property such as cars, jewelry, and household items. Another property that will be divided is intangible property such as income, dividends, benefits, and debts. Any property that is separate property remains in the hands of the spouse who owned it before or during the marriage.

Mixing marital funds with separate funds is referred to as “commingling” and commingling funds can endanger the status of your separate property. It also means that you need to refrain from using marital funds to pay for any costs of maintenance and upkeep of the home.

Obtain a Legal Separation

In some cases, getting a legal separation before proceeding with a divorce makes sense. If you practicable in your case, having a legal separation along with a property settlement agreement signed by your spouse will protect your new house from being considered marital property. Your property settlement agreement should specifically address newly acquired property and separate assets. Notwithstanding the settlement agreement, you still need to avoid using marital money to pay for any aspect of your new home.

Consider Potential Support Payments

Before you start your search for a new home, give careful consideration to your financial situation. A divorce can be a financial drain, even if the divorce is amicable. You may not be able to maintain the same lifestyle solely on your own income that you enjoyed as a married person. You may have to compromise in several areas that you are not now able to fully appreciate. Additionally, you might be ordered to pay child or spousal support in amounts you cannot afford along with a new mortgage payment. On the other hand, if you are counting on a specific amount of support payments after the divorce, consider whether you can afford the mortgage if your former spouse defaults on any payments. Also, think about how you will handle the mortgage when the support payments end.

Another important consideration is how taking ownership of a significant asset such as a new home will affect your financial picture in court. If you take the title to a new house before the divorce is final, you will have to include it as part of your total assets when dividing marital property. By owning a significant separate asset, the court might be inclined to decrease your share of the marital property and award your spouse a larger percentage of the joint assets.

Evaluate Any Special Circumstances

As alluded to earlier, your own unique circumstances could affect your post-divorce financial picture. For example, if you are at fault in ending the marriage, the court may order you to pay more support or have your support reduced. Even though spousal support is a payment from one spouse to the other to help the recipient spouse maintain a lifestyle as close as possible to the one they had during the marriage, the court will factor into the final order any bad behavior that led to the divorce.

Work with an Experienced Virginia Real Estate Agent

Avoid mistakes in buying a house during a divorce or divorce settlement. Consult with a licensed Virginia real estate agent at the Katie Zarpas Group if you are looking for a new home before your divorce is final. Their experienced agents can guide you through the process and help make sure your transition into a new home as smooth as possible.

Buying beach real estate to enjoy in your retirement is a dream that may now be in reach for you. Images of long walks on the beach, sounds of waves lulling you to sleep, and ocean breezes caressing your skin fill your thoughts. It is an exciting time of your life and you’ve worked hard to make it come true.

Top 5 Tips for Buying Beach Real Estate

In the excitement of making your dream of a beach house come true, take care not to overlook a few important considerations during your search. Here are some tips to keep in mind as you look for beach real estate:

Check Out Different Communities

Look at many different properties and communities before settling on one. You might like a particular beach, but you need to investigate the area surrounding it and different communities. That means learning about the community and nearby plans for development. You may not like the fact that a beach house you love will soon have a four-story condo building next door. Also, many beach communities are seasonal. Make sure you will love the house just as much in-season and off-season.

Drive around and see what is nearby. Save yourself some time by using various online maps to see aerial and street views of the surrounding area.

Compare Needs vs. Budget

Take some time and create a list of features you want and figure out what you really need in a beach house. Determine which of those things you can comfortably afford. Think about it as you would your primary home. For example, consider how many bedrooms and bathrooms you’ll need. Think about how much entertaining you will do. You should expect to have more visitors to your beach house than you may expect.

Another important consideration is how much maintenance and repair the house will need. Being near the ocean will expose the home’s exterior to salty air, saltwater, harsh sun, and sand. Keeping it up can be expensive. Salt air and saltwater are corrosive, so you need to expect frequent repair and replacement. If all of that is within your budget, make sure there is nothing else you would prefer to do with the money.

Take Location and Insurance into Consideration

Shop around for homeowner’s insurance. Is insurance even available for a home in your chosen beach location? If it is available, make sure your budget will cover the premiums you’ll face to insure it. If you are getting a mortgage to buy the house, the lender will likely require you to have special insurance for flood, wind, or hail damage. Don’t forget to factor in premium increases, too.

You may decide that the cost of insuring a beachfront property is just too much. If so, you may want to look at homes that are a short distance away from the beach. You will find lower sales prices and a little less ongoing maintenance. By moving your search just a few blocks off the beach, your insurance costs and other expenses will be a little lower because you will have better protection from the harshest beachfront weather, floods and storm surges.

Research Local Weather Patterns

Go online and look at the weather patterns and storm history for the area before you buy beach real estate. Is the area prone to annual hurricane damage? If so, what months are the most frequent?  Have a home inspection done by an inspector that specializes in waterfront property. A specialized inspector can tell you about the weather and maintenance issues unique to the area. The inspector will look for problems caused by proximity to the ocean and its weather. For example, the inspector will be able to tell if the house has been flooded and the frequency of flooding. Salty floodwaters do significant damage to electrical systems, foundations, and wood. Make sure that if the home is destroyed by a weather event you will be allowed to rebuild.

Will You Ever Rent It Out?

A popular way to recoup some of the costs of a beach real estate is renting it out to vacationers. If you plan to do that, keep some things in mind as you do your house hunting. The first is to make sure the community permits it and understand any restrictions placed on it by the HOA (if applicable) and local ordinances. You may need a home inspection and a license before you can rent it.

Another important consideration is how you will market the house for rent. The community may have an on-site management agent to do that, or you’ll have to make your own arrangements.

Find out from the sellers whether they rented the house previously and how much the property earned during the past few years. If written records of the rental income and expenses are available, ask to see them.  In some beach areas, homes with more bedrooms and bathrooms are the most popular and bring the most in rental income.

Discuss Your Options With Agents Who Know Beachfront Properties

Let the beachfront experts at Katie Zarpas Group help you find your dream beach house. Contact their office for more information and get started looking for your new beach real estate property.

At some point in their lives, most adults will likely have to make an important decision about when to rent vs when to buy a home. Renting means that you’re living in a property that someone else owns. You usually pay a monthly fee (rent), and you can live there as long as you continue to pay. Buying a house means you’re the owner of the home you live in. You’ll make monthly mortgage payments that will eventually end once the house loan is paid off. 

To Rent or to Buy?

Figuring out whether to rent or buy can be a difficult decision. Taking a look at your options and expenses can help in this decision. So which option is right for you? Let’s break down the differences between when to rent vs. when to buy. 

When to Rent

Here are some of the advantages when renting a home:

• Fewer upfront costs: To move into a rented home, you’ll usually have to pay a security deposit equal to 1 and ½ months’ rent. Other than paying movers, that’s the only upfront cost you’ll have. When you buy a home, you’ll have to make a down payment, pay closing costs, and possibly renovate. That’s tens of thousands of dollars before you even move in.
• More freedom: You can decide to leave your rented home at any time. If you have a house, you’ll need to sell it before you move anywhere.
• No maintenance: When renting, you’re not responsible for any repairs or upkeep of the property. Whether you’ve got a leaky faucet or the roof needs to be replaced, it’s all the responsibility of the landlord. The landlord is responsible for landscaping and shoveling snow, too.
• No property taxes: When you own a home, your property taxes are added to your mortgage, which means extra hundreds of dollars per month. And if your taxes go up, then your monthly mortgage payment goes up, too. You don’t have to worry about any of that when you rent.
• No home value worries: When renting a home, the neighborhood property values aren’t your concern. When you purchase a home, however, you hope that it’ll one day be worth more than what you paid for it. But there’s no guarantee that’ll happen. Sometimes, your home can lose value and you can’t sell it for as much as you paid for it.
• Opportunity to build credit: Maybe you want to buy a home, but your credit history isn’t very good. If you make timely payments on a rental property that you can afford, you’ll build up a good credit history in no time. 

When to Buy

Some of the advantages when buying a home include:

• Opportunity to build credit and equity: When you are paying a mortgage on time each month, you’re strengthening your credit just like with renting, but you’re also building equity. Equity is the difference between the current market value of your home and how much you owe. For example, if your home is worth $300,000 and you owe $200,000 on the mortgage, then your equity is $100,000. You can borrow against that amount to make home improvements, pay for a child’s education, or invest in something else.
• Upgrades are possible: When you rent a home, you may want to remodel the kitchen or the bathroom, but you can’t. First of all, you’re not allowed. Second of all, it doesn’t make sense to update a home you don’t own. When you own a home, you can make any improvements you like at any time and add more value to your home at the same time.
• Tax benefits: You can deduct your mortgage interest and property tax payments from your federal taxable income. There are no tax benefits when renting.
• More stability: If you find a neighborhood that you like, then purchasing a house for your family in that community provides a sense of belonging and more stability for everyone.  

Figure Out The Right Decision With a Virginia Beach Real Estate Agent

If you’re on the fence about when to rent vs buy a home, carefully consider the advantages above. Think about your personality, living preferences, and financial situation and determine which option aligns best with your lifestyle.

If you have questions about when to rent vs. buy, then talk to an experienced real estate agent like Katie Zarpas. Katie prides herself on her personal, hands-on approach, and the creative style and quality of her work reflects that. Katie’s marketing, sales, and transactional expertise make her an invaluable partner and resource for any real estate client. Reach out today by phone at 757-685-4400, or by scheduling an appointment online.