For most couples, the family home is the largest asset in a divorce. It’s also the most emotionally charged. Questions about who gets the house — or what happens to it — are among the most common and difficult to resolve in any Maine divorce proceeding. Here’s what you need to know.
Is the Family Home Marital Property in Maine?
Maine follows a system of equitable distribution of marital property. In general, property acquired during the marriage — including the family home — is considered marital property, regardless of whose name is on the deed. Equitable does not mean equal: the court divides property in a way it considers fair given all the circumstances.
However, property owned by one spouse before the marriage, or received as a gift or inheritance during the marriage and kept separate, may be treated as non-marital property and not subject to division. The lines can blur quickly if, for example, marital funds were used to pay the mortgage or make improvements on a home one spouse owned before the marriage.
Maine’s Equitable Distribution Factors
When determining a fair division of the marital home, Maine courts consider factors including:
- The length of the marriage
- Each spouse’s contribution to acquiring and maintaining the property
- Each spouse’s current and future economic circumstances
- The value of each spouse’s non-marital property
- Whether either spouse is the primary caregiver for minor children and wishes to remain in the home for stability
- Any economic misconduct by either spouse (e.g., waste of marital assets)
The Three Main Outcomes for the Marital Home
Option 1: One Spouse Keeps the Home (Buyout)
One spouse can keep the home by buying out the other spouse’s equity interest. The buying spouse typically refinances the mortgage in their name alone, removing the other spouse from the loan obligation. The departing spouse receives their share of the equity — either as a lump sum or as an offset against other marital assets.
This option requires the staying spouse to qualify for refinancing on their own income, which isn’t always possible — especially in the period immediately following a divorce.
Option 2: Sell the Home and Divide the Proceeds
Many divorcing couples choose — or are ordered — to sell the marital home and split the net proceeds. This is often the cleanest resolution, allowing both parties to fully disentangle their finances and move forward. The parties must agree (or the court must order) the listing price, realtor, and terms of sale.
Courts can and do order the sale of a marital home if the parties cannot agree on another solution. An attorney can help you negotiate the terms of a home sale in your divorce agreement to protect your interests.
Option 3: Deferred Sale (Nesting Arrangement)
In some cases — particularly where minor children are involved — the parties agree to delay the sale of the home for a defined period, often until the youngest child finishes school or either spouse remarries. This arrangement, sometimes called ‘nesting,’ requires careful legal documentation regarding expenses, maintenance, and ultimate sale terms.
What About the Mortgage?
If both spouses are on the mortgage, both remain legally obligated to the lender until the loan is refinanced or paid off — regardless of what your divorce agreement says. A divorce court order cannot override your contract with the lender. This is why refinancing (when feasible) is usually the preferred option when one spouse keeps the home.
If the staying spouse cannot refinance, you may need to include provisions in your divorce agreement that address what happens if the mortgage goes unpaid, or establish a timeline by which refinancing must occur.
Tax Considerations
The tax implications of transferring or selling the marital home can be significant. Transfers of property between spouses incident to divorce are generally not taxable events under federal law. However, if the home is sold, the capital gains exclusion ($250,000 for a single filer, $500,000 for a married couple filing jointly) can affect your tax exposure depending on when the sale occurs relative to the divorce.
We always recommend consulting a CPA or tax advisor as part of your divorce financial planning.
What If We Can’t Agree?
If you and your spouse cannot reach an agreement about the family home, the court will decide. Maine courts have broad authority to divide marital property — including ordering a sale — when parties cannot resolve the issue themselves. Mediation is often an effective way to reach a workable resolution without handing the decision to a judge.
Ready to take the next step? Contact Dirigo Divorce PLLC for a confidential consultation. Dirigo Divorce serves clients throughout Androscoggin Count, York County and Cumberland County, Maine, and southern New Hampshire. Call or contact us online today.