Divorce Home Buyout: How to Buy Someone Out and Negotiate

In a divorce home buyout, one person accepts the ownership of the home while the other is freed of all financial obligations toward it. Rather than selling the home and splitting the proceeds in half, one person buys out the other. The spouse who stays keeps the house;  the other gets a payout. 

Divorce home buyouts can be complex, but they are good options for some couples. Keep reading to find out how they work and why a home buyout could be right for you. 

Who gets the house in divorce? How do you split the value? Try our Home Equity Buyout Calculator.

How does a buyout work?

In divorce, people may split their assets evenly. For most families, the primary residence is the largest asset they own. The easiest way to divide this important investment is to sell it and split the proceeds. A buyout is a little different.

In a divorce home buyout, one person sells their share of the home to the other. A divorce home buyout must be mutual. One person can't force the other out. But for some families, it's a smart choice. 

How do you calculate the buyout price?

Most people have an idea of what their home is worth. But for a fair home buyout in a divorce, you must dig deeper. Often, various expenses are involved. 

Take the following steps to make sure you settle on the right price for your home.

Hire a professional appraiser

A trained appraiser examines your home, both inside and out, and compares the data to your current real estate market. They create a formal report that details how much your home is worth right now, along with improvements that could drive up the price.

On average, an appraisal costs $300 to $450, but larger homes often cost more to assess. 

Ask a realtor's advice

While an appraisal should give you data about how much your home is worth in today's real estate market, a realtor could tell you even more. Realtors can walk through your home, take measurements, ask questions, and produce a report with information about the current sale price in the market. 

Most realtors don't charge fees for these assessments, but they do charge listing fees. If you're debating selling the home versus a buyout, this fee could be an important factor.  

Contact your mortgage company

The buyout price involves the current market value with your loan balance subtracted. If you're not certain of your loan balance, it's critical to do your homework. 

Additionally, some banks charge a prepayment fee of about 2% of the outstanding balance. Others waive this fee if buyers roll the balance into a new loan product. But transferring the balance can come with fees, too.

It's helpful to get a full picture of the costs of each scenario: paying off the balance, transferring the loan or selling the home. 

Consult with an accountant

In most cases, people aren't slapped with capital gains fees for real estate transactions during a divorce. But if your divorce drags on, you could be assessed a fee. An accountant can help you understand the tax implications of each decision, and most charge on a per-hour basis. 

Home buyout financing options

Many divorcing people want to keep their shared home, but they lack the equity to buy out the other person. Your finances can take a hit during divorce, causing you to come up short.

Mortgage companies can provide refinancing loans, allowing you to buy out your spouse and emerge with a brand new loan in your name only. To do this, you must pass a credit check and meet the bank's requirements for the new loan, and that isn't always easy. But if you have a steady job and a good credit history, it's possible that you’d qualify on your own. 

You could also ask family members to loan you the money needed for the buyout. Your parents or grandparents might be willing to offer you an early inheritance you could invest in your home. 


Home buyout negotiating tips

Since home buyouts must be mutually agreed upon, you must convince your partner that this is the best option. The following tips might help:

  • Explain how keeping the home benefits your children. Divorce can be traumatic for children. Staying in a known space could help them cope and give them a sense of familiarity during this volatile time. 
  • Make the buyout price fair. It's tempting to cut corners, deflate the price, and lowball your partner. Do your best to be honest throughout the negotiation process. If you make a good faith effort to be fair, they are more likely to respond in the same way.
  • Hire all the experts you need. Arguments are harder to mount in the face of hard data. Get all of the reports from professionals, and make sure that you comply with their recommendations. 
  • Get ready to trade. You want the family home. What does your partner really want? It’s possible they want something different. When you both emerge from the divorce with goals met, you'll better preserve your relationship.

What if a home buyout isn't the best option?

People with children, a good credit rating, an emotional attachment to the home, and a willingness to trade often do well in a buyout. But sometimes, this plan isn't a good fit for both parties.

If you can't raise money for the buyout or your partner isn't willing to hand over partial possession, consider selling the home. You'll find another home in time, and it won't come with emotional baggage.

Who gets the house in divorce? How do you split the value? Try our Home Equity Buyout Calculator.



Home Ownership Remains Primary Driver of Household Wealth. (February 2021). National Association of Home Builders. 
How Much Does a Home Appraisal Cost? It Depends on Several Factors. (February 2022). Bankrate. 
Prepayment Penalty: What It Is and How to Avoid One. (July 2020). Forbes
Applying Capital Gains Tax in Divorce Cases? (September 2013). ACCA.
Divorce Specialists
After spending years in toxic and broken family law courts, and seeing that no one wins when “lawyer up,” we knew there was an opportunity to do and be better. We created Hello Divorce to the divorce process easier, affordable, and completely online. Our guiding principles are to make sure both spouses feel heard, supported, and set up for success as they move into their next chapter in life.