5 Costly Real Estate Mistakes to Avoid During Divorce | Michigan CDRE

The Biggest Mistake Happens Before the House Ever Hits the Market

One of the biggest misconceptions I encounter is that real estate planning begins when the parties decide to sell the marital home.

In reality, that's often when many of the most important decisions have already been made.

As a Certified Divorce Real Estate Expert (CDRE®), I'm frequently brought into a case after months of negotiations have already taken place. The parties may have already agreed on a value, discussed repairs, assumed refinancing will be simple, or even drafted settlement language regarding the home.

Unfortunately, by that point, valuable opportunities may have already been missed.

Whether you're a homeowner navigating divorce or an attorney guiding a client through the process, one thing remains true:

The earlier real estate planning begins, the more options everyone has.

Below are five common mistakes I see before a home is ever listed—and how addressing them early can lead to better financial outcomes.

Mistake #1: Assuming Yesterday's Home Value Is Still Accurate or Relying Solely on an Appraisal

One of the first questions in almost every divorce involving real estate is:

"What's the house worth?"

It's an important question because that number often influences buyouts, refinancing decisions, settlement negotiations, and ultimately how one of the couple's largest assets is divided.

One of the biggest mistakes I see is relying on an outdated valuation—or assuming an appraisal automatically reflects what the home will sell for in today's market.

While an appraisal serves an important purpose, it's simply one opinion of value based on a specific point in time and a specific methodology. Market conditions, buyer demand, interest rates, and comparable sales can all change in just a few months.

A home's appraised value and its market value are not always the same. The market ultimately determines what a willing buyer is prepared to pay under current conditions.

That's why it's important to begin with a current, market-based valuation when making significant financial decisions during a divorce. Having an accurate understanding of today's market helps attorneys and homeowners make informed decisions and reduces the likelihood of surprises later in the process.

Related Reading:
Wondering what the difference is between and appraised value and market value?  Read my article: 

What Divorcing Homeowners and Family Law Attorneys Need to Know About Upcoming Appraisal Changes

Mistake #2: Waiting Until the House Is Listed to Think About Its Condition

Divorce is emotionally exhausting.

Home maintenance often becomes an afterthought.

One spouse may have already moved out. Finances are tighter. Neither party wants to spend money on a home they may soon leave.

Unfortunately, buyers don't know the story behind the deferred maintenance.

They simply notice:

• Worn flooring
• Peeling paint
• Overgrown landscaping
• Outdated fixtures
• Minor repairs that were never completed
• General signs that the home hasn't been well maintained

What many homeowners don't realize is that buyers rarely deduct only the cost of repairs. They also factor in inconvenience, uncertainty, and perceived risk.

Sometimes a relatively inexpensive repair completed before listing can preserve far more money during negotiations.

Not every improvement is worthwhile—but identifying the right ones before the home goes on the market can have a meaningful impact on the final outcome.

Mistake #3: Assuming Refinancing Will Be Straightforward

Many divorcing couples hope one spouse will keep the marital home.

Sometimes that's the right solution.

Sometimes it isn't.

Qualifying for a mortgage after divorce often looks very different than qualifying during the marriage.

Household income changes.

Debt-to-income ratios change.

Support obligations may affect qualifying income.

Interest rates may be significantly different than when the original loan was obtained.

Understanding whether refinancing is realistic early in the process gives everyone more flexibility and helps prevent unpleasant surprises after settlement terms have already been negotiated.

Mistake #4: Drafting Settlement Terms Before Answering the Real Estate Questions

One of the most common situations I encounter is receiving a call after the settlement language has already been written.

The agreement may say the home will be refinanced or sold—but many of the practical questions haven't yet been answered.

Questions such as:

• What happens if the refinance is denied?
• What if the appraisal comes in lower than expected?
• Who is responsible for repairs?
• Who maintains the property while it's on the market?
• What happens if price reductions become necessary?
• What if the home doesn't sell within the anticipated time frame?

These aren't just real estate questions.

They're questions that can directly affect whether the settlement functions as intended.

Discussing them early often prevents unnecessary conflict and delays later.

Mistake #5: Waiting Too Long to Build the Right Team

One of the biggest misconceptions about my role is that I'm simply the Realtor who lists the house.

In reality, some of the most valuable work happens long before a listing agreement is ever signed.

Sometimes I'm providing a neutral market valuation.

Sometimes I'm helping determine which repairs will have the greatest impact on marketability.

Sometimes I'm collaborating with attorneys, lenders, mediators, and financial professionals to identify potential issues before they become expensive problems.

Selling the home is only one part of the process.

Planning for the sale is where many of the most important decisions are made.

CDRE Tip

The best time to involve a Certified Divorce Real Estate Expert isn't when the house is ready to be listed—it's when the parties begin discussing what should happen to the house.

Early planning creates options. It allows everyone involved to identify potential obstacles, establish realistic expectations, and make informed decisions before those decisions become constrained by deadlines, contracts, or court orders.

The Bottom Line

The marital home is often the largest financial asset involved in a divorce, yet it's frequently one of the last pieces of the puzzle to receive strategic attention.

Whether the outcome is a sale, a refinance, or one spouse retaining the home, many of the decisions that shape the financial outcome happen long before the property is ever listed.

Starting the conversation early gives homeowners more time to understand their options, prepare the property, evaluate financing, and make informed decisions based on current market conditions—not assumptions. It also gives attorneys the opportunity to identify potential obstacles before they become disputes that delay settlement or complicate the transaction.

My goal isn't simply to sell homes.

It's to help homeowners, attorneys, and the other professionals involved in the divorce process navigate one of life's largest financial decisions with greater clarity, fewer surprises, and a strategy designed to produce the best possible outcome.

If you're navigating a divorce involving real estate—or you're an attorney representing a client with questions about the marital home—I'd be happy to be a resource. Sometimes the most valuable conversation is the one that happens before the house ever goes on the market.

Questions About the Value of a Marital Home?

Whether you're a homeowner, attorney, mediator, or financial professional, understanding the difference between appraised value and market value can be critical when making divorce-related real estate decisions.

Amy Osterbeck, CDRE®
Certified Divorce Real Estate Expert
Associate Broker

Serving Oakland County, Macomb County, and Southeast Michigan

📞 586-945-5323