Page 31 - May-June 2025 Life In Naples Magazing

What Happens

to Real Estate

in a Florida Divorce?

by Iman Zekri, Esq. How are mortgages handled in a divorce?
ividing property during a divorce is If one spouse keeps the marital home, and the other spouse
often one of the most challenging transfers the property out of their name, then the couple’s mortgage
Daspects for couples, particularly with company will likely require that the spouse retaining the property
regard to real estate. In Florida, equitable refinance the mortgage in their name to remove the other spouse from
distribution laws and other liability. Until this is done, both spouses remain legally responsible for
legal considerations come the mortgage payments, regardless of
into play. whose name is on the deed.
With the help of my What about investment properties or vacation homes?
colleague, real estate attorney Alessandro Secino, Investment properties or vacation homes are treated similarly to the
we share guidance to frequently asked questions marital home. Their classification as marital or non-marital property
to help couples understand the process and and their division depend on when and how they were acquired and
potential issues that may arise when dealing whether marital funds were used for upkeep or improvements. Unlike
by Alessandro Secino
with real estate during a divorce. with the marital home or a couple’s homestead property, investment
How is real estate divided in a Florida divorce case? properties or vacation homes are typically subject to documentary
Florida is an equitable distribution state, meaning the court will stamp taxes based on the amount of consideration exchanged for the
divide marital property, including real estate, in a manner deemed property. Consideration includes anything of value given or exchanged
fair. Although it is most common for the court to equally split the for a piece of real property, for instance if a vacation property is
marital assets, there are rare occasions when a court may provide encumbered by a mortgage, then the transfer is taxable based on
for an unequal division of the marital assets after considering the current principal balance of the mortgage relative to the interest
factors such as each spouse’s contribution to the marriage, the transferred. Documentary stamp taxes can result in additional costs
duration of the marriage, and each party’s economic circumstances. incurred by the parties in connection with the divorce.
What qualifies as marital property? How does Florida law address homestead exemptions in divorce?
Real estate acquired during the marriage is typically considered Florida’s homestead exemption can complicate divorce proceedings.
marital property, regardless of whose name is on the title. Property If one spouse remains in the marital home, they may continue to
owned by one spouse before the marriage or acquired through benefit from the exemption. However, any transfer of ownership or
inheritance or a gift may be considered non-marital property, changes in residency status can impact the exemption’s applicability.
unless it has been retitled in the spouses’ joint names as husband What if there is a prenuptial or postnuptial agreement?
and wife, or commingled with marital assets. Also, the paydown Prenuptial and postnuptial agreements can significantly impact
of a mortgage on nonmarital real estate with marital funds is how real estate is divided. If the agreement specifies how property
considered a marital asset in Florida. should be handled in the event of a divorce, Florida courts typically
What happens if both spouses want to keep the house? honor those terms, provided the agreement is legally valid and
If both spouses wish to retain the marital home, the court may enforceable.
evaluate their ability to maintain the property, including financial Are there tax implications for dividing real estate?
resources and the best interests of any children. In many cases, one Yes, selling real estate or transferring ownership during a divorce
spouse buys out the other’s share of the equity at fair market value. can trigger tax consequences, such as capital gains taxes or property
If the spouses cannot agree on the value of the home, then they tax reassessments.
may need to obtain a professional appraisal of the real estate. Bottom Line
What if neither spouse wants to keep the house? When going through a divorce in Florida, splitting real estate can
If neither partner wants to keep the marital home, the usual be complicated with various legal and financial factors to consider.
route is to sell the property and split the profits fairly. This involves It is important for couples to understand the concepts of equitable
figuring out the home’s current market value and taking into distribution as well as how mortgages and tax implications come into
account any outstanding mortgages or liens that may be play, to make the process smoother.
attached to it. If you have any questions or need help, feel free to reach out to me at
(239) 344-1119 or iman.zekri@henlaw.com to set up a consultation.

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