My question involves divorce in the State of: Washington (Community Property state)
Spouse and I are getting a divorce, which we have both agreed should be uncontested. There are a few details we are having differences on though. Here is a quick summary of our situation:
We owe $197,000 on a home that is estimated to be worth $170,000. The house also needs a new roof, fence, and a few other things before it could be sold. The estimated costs needed to bring the house to the point it could be sold is approx $10,000.
We also have $20,000 in credit card debt.
Assets are of approximate value in the $16,000 range. And those could easily split evenly with no contention.
Questions:
Are the costs associated with bringing the house up to par typically looked at as an addition to the negative equity currently in the house? ie. We are at -$27,000 equity in the house. Should the -$10,000 in repairs to the house that are needed, be added to the negative equity in the house when it comes time for division of debt?
My suggestion to my spouse was that I would take the home and the -$37,000 (negative equity and house repairs needed) plus $8,000 of the physical assets. Putting me at walking away from the marriage with a total debt load of -$29,000.
My spouse would accept the -$20,000 in credit card debt plus $8,000 of physical assets. Putting them in the position of walking away from the marriage with a total debt load of -$12,000.
The $8,500 they would normally owe me to bring our respective debt loads even, would be waived by me in exchange for no spousal support/maintenance.
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Here is the dilemma:
My spouse believes that it might be in their best interests to force a short sale of the home (having the bank agree to accept whatever we could sell it for as full payment on our debt). We both walk away from the house in the clear, but with a huge hit to our credit... Then we would split the -$20,000 in credit card debt at -$10,000 ea. And my spouse recieving $200/mo in spusal support/maintenance for several years.
Further even if my spouse accepts my original plan they believe that they should be entitled to a percentage of any profit I make off of the house in the future. I am honestly not seeing that logic in the least.
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Some further info: I am employed, they are not, but can be. We estimate I will be making about twice what they will likely be (me: $2,900/mo, them: $1,450/mo). We also have a 12yo son together. We have been married 15 years. Also, my spouse does not want the house in any way shape or form.
So, assuming we cannot come to terms on this point and the divorce becomes a contested one.
- How likely is the court to be to see my solution as a reasonable one? Obviously it certainly seems to me to be so.
- How likely are they to force us to short sale the house and take a huge hit to our credit when I am willing to take it over to avoid that?
- How likely are they to say that if I do take the house that she will be entitled to a percentage of it's profit at some point in the future?
- Finally, how likely (looking at our relative incomes) is the court to give her spousal support/maintenance?
Thank you all so much in advance for your help and advice in this.

