Originally published: June 2023 | Updated: December 2025
In Illinois divorces, what happens to the house usually comes down to two outcomes: one spouse keeps the home and buys out the other spouse, or the house is sold and the net proceeds are divided.
The court considers fairness, finances, and children’s needs, not automatic 50/50 splits.
Illinois follows equitable distribution laws, so the court divides property fairly in each case rather than automatically splitting everything 50-50.
The choice about what to do with the house affects more than just money. It impacts where children go to school and how much each person can afford afterward.
It also shapes how quickly both spouses can move forward with their lives. Knowing the pros and cons of each option makes it easier to reach an agreement that works for everyone involved.
Whether your home is considered marital property in an Illinois divorce depends on when and how it was acquired and paid for.
A house bought during the marriage with marital funds is usually considered marital property. A home owned before marriage or inherited may be non-marital, especially if finances stayed separate.
A marital home is generally any property purchased during the marriage, regardless of whose name appears on the title.
If both spouses contributed to buying the house or paying the mortgage after getting married, the home typically qualifies as marital property subject to division.
Non-marital property includes homes one spouse owned before the marriage. But if marital funds were used to pay the mortgage or make improvements, part of the home’s value could become marital property.
The court might award reimbursement or divide equity between both spouses in these situations.
For instance, if one spouse owned a home before marriage but both spouses contributed to mortgage payments or improvements during the marriage, at least part of the house may be considered marital property.
This mixing of funds, called commingling, can change what was once purely non-marital property into a hybrid asset.
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One spouse can keep the house in a divorce in Illinois if it is financially realistic, and the other spouse’s equity can be addressed fairly.
That typically requires an appraisal, agreement on equity, a buyout, and refinancing the mortgage within a clear timeframe to remove the other spouse’s obligation.
A professional appraisal shows the home’s current market value. This establishes the amount of equity remaining after subtracting any outstanding mortgage balance.
The spouse who keeps the home must compensate the other spouse for their share of that equity. Illinois uses equitable distribution, so the split should be fair but not necessarily 50/50.
The court considers factors like each spouse’s income, contributions to the home, and financial needs.
Payment options for the buyout include:
The most tax-efficient approach usually involves offsetting the equity value against maintenance since receiving property in divorce isn’t taxable. Both spouses must agree on the appraisal value; if they do not, the court will decide.
The spouse who keeps the house must refinance the mortgage in their name alone. This removes the other spouse from financial liability and protects them from future payment issues.
Lenders look at the spouse’s income, credit score, and debt-to-income ratio. They want proof that the person can afford the mortgage payments without their ex-spouse’s income.
Many divorcing individuals struggle to qualify on a single income, and honestly, that’s a hurdle that can throw a wrench in plans.
If refinancing immediately isn’t possible, some couples temporarily maintain joint ownership. This arrangement is risky, as both remain legally responsible for the payments.
The spouse who moved out could face credit damage if the remaining spouse misses payments.
Banks usually require the divorce decree and property settlement agreement as part of the refinance application. They want confirmation that one spouse has legal authority to refinance.
Getting pre-approved before finalizing the divorce helps avoid surprises down the road.
Selling the house in an Illinois divorce and splitting the equity is common when neither spouse can or wants to keep the home.
The property is listed, the mortgage and closing costs are paid, and the remaining net proceeds are divided according to your settlement agreement or the court’s order.
The division of sale proceeds starts with calculating the net equity. This means taking the final sale price and subtracting the remaining mortgage balance, real estate agent commissions, closing costs, and any agreed-upon repairs or staging expenses.
Illinois uses equitable distribution rather than community property laws. The court aims for fairness based on each spouse’s situation.
Factors include how long the marriage lasted, each person’s income, and who contributed to the down payment or mortgage payments.
Many divorcing couples reach a split agreement through negotiation before going to court. A common approach is a 50/50 division, but this isn’t required.
One spouse might get a larger share if they gave up other marital assets or made significant financial contributions to the home.
The actual distribution happens at closing. The title company or closing attorney disburses funds in accordance with the divorce decree or settlement agreement.
Both spouses usually need to sign the sales documents, unless the court has granted sole authority to one party.
If you’re debating whether to keep, sell, or refinance your home in divorce, schedule a strategy session with Cooper Trachtenberg Law Group and test the numbers safely.
If you’re ready to get started, call us now!
What happens to the mortgage in an Illinois divorce depends on who keeps the house and whether refinancing is possible. If one spouse keeps the home, they usually refinance it in that spouse’s name.
If the mortgage is underwater or the refinance fails, spouses may need to negotiate payments, shortfalls, or a sale.
An underwater mortgage happens when a couple owes more on their home loan than the house is currently worth. This creates a negative equity situation, complicating property division.
Illinois courts still divide the debt as part of the divorce settlement. Both spouses may remain legally responsible for the mortgage in an Illinois divorce until one spouse refinances or the home is sold.
The lender doesn’t care about the divorce decree—it’s just business to them.
If the couple sells the house for less than the mortgage balance, they must pay the shortfall. They need to agree on how to split this debt.
One spouse might take on the full shortfall in exchange for other assets or reduced support payments.
Some couples choose a short sale with lender approval. Others keep the home temporarily and hope the market improves.
A spouse who can’t afford the payments may face foreclosure, which damages both parties’ credit scores even after divorce.
The house and school district affect children in an Illinois divorce because housing decisions often determine where kids live and attend school.
Courts consider the child’s best interests, but parents must still balance stability with financial reality. Some families use temporary arrangements so children can finish a school year before moving.
Some divorcing parents choose to postpone selling the house until their children reach certain milestones, like graduating from high school. This keeps kids in their familiar school district and maintains their friendships and activities.
The arrangement works best when both parents agree on how to share housing costs and home maintenance responsibilities.
Nesting is when children stay in the family home full-time while parents take turns living there. Each parent stays elsewhere during their “off” time.
This setup minimizes disruption to children’s daily routines and school attendance.
Illinois courts consider children’s best interests when deciding what happens to the family home.
If one parent has primary custody, they may be more likely to keep the house.
School choice decisions after divorce often depend on which parent has decision-making authority for education matters in the parenting plan.
These temporary arrangements require clear legal agreements on who will pay the mortgage, property taxes, and repairs during the deferred sale period.
Deciding what to do with the house in a divorce in Illinois means weighing emotions against numbers. Ask whether you can truly afford the home, how it fits your parenting plan, and what other assets you need.
A strategy session with an Illinois divorce lawyer can test realistic options before you commit.
Before you decide whether to keep or sell the marital home, you should ask yourself some tough questions.
Can you—or your ex—actually afford the mortgage, property taxes, insurance, and maintenance on just one income?
This isn’t something to gloss over. Hanging onto a house that pushes your budget to the brink can cause a world of financial stress down the line.
Think about the kids, too, if they’re still living at home. Will staying in the house give them a sense of stability as everything else changes?
Illinois courts consider what’s in the children’s best interests when deciding who gets the house. That’s not always as clear-cut as people hope.
Ask yourself if the home fits your new life. Maybe the place feels too big, or maybe it’s just too much to keep up with on your own.
Don’t forget to get a handle on the home’s current market value and equity. You’ll want those numbers to ensure any buyout or sale agreement doesn’t leave anyone shortchanged.
Your home decision shapes your finances and your kids’ stability. Talk with Cooper Trachtenberg Law Group about realistic house options in your Illinois divorce before you commit.
Who usually gets the house in an Illinois divorce?
No one automatically “gets” the house in an Illinois divorce. The court considers marital status, finances, children’s needs, and each spouse’s ability to afford the home. One spouse may keep it with a buyout, or the house may be sold and the proceeds divided.
How is home equity divided in an Illinois divorce?
Home equity in an Illinois divorce is divided under equitable distribution, which means fair, not always 50/50. Equity is usually calculated as market value minus mortgage and selling costs. Courts or settlements then allocate that equity considering income, contributions, debts, and the overall property division.
Can both spouses stay on the mortgage after divorce?
Both spouses can technically stay on the mortgage after divorce, but it is usually risky. If your ex misses payments, your credit is still affected. Most settlements require a refinance, a sale, or a clear plan so that one person is not indefinitely tied to the other’s payment behavior.
Do I lose my rights to the house if I move out?
Moving out of the marital home does not automatically mean you lose your rights to the house or its equity. Ownership and equity are determined by property division, not by who stayed.
Can we keep the house until the kids finish school?
You can agree, or sometimes ask the court, to keep the house until the kids finish school, then sell and divide the equity. This is often called a deferred sale or similar arrangement. It must be financially realistic, with clear rules regarding mortgages, taxes, and future sales.
What happens if we can’t afford to refinance the mortgage?
If you cannot afford to refinance the mortgage after divorce, you may need to sell the house, negotiate a temporary co-ownership, or restructure other parts of the settlement. Leaving both names on the mortgage long term is usually discouraged because it keeps both spouses financially exposed.
What if the house is only in my spouse’s name?
If the house is only in your spouse’s name, you may still have a marital interest if it was acquired or paid for during the marriage. The title alone does not decide rights in Illinois. Courts consider when and how the property was funded and improved before dividing the equity.
Are we required to sell the house in an Illinois divorce?
You are not automatically required to sell the house in an Illinois divorce. One spouse may keep it with a buyout and refinance, or you may agree to a future sale. If no realistic plan exists for keeping it, the court is more likely to order a sale.
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