Q: Uncontested divorce, ex is buying out of house: appraisal vs fair-market-value?
I live in OR, and I'm going through my first divorce - short-lived marriage, no dependents, etc.
It's been uncontested so far so most of the assets and finances have been simple, and already divided.
We bought a house about a year before the marriage (~1 year married). When we bought it, we put down equal down payments so that it'd be 50/50 ownership to start. As we renovated it, I contributed at least 2/3 of the money; however we were going to split the proceeds from the house sale at 50/50...
He wants to stay in the house via cash-out refinance and buying out my half. We agreed (verbally and informally) that he could try to buy me out of the house, but... He wants it to be 50/50 of the [recent] appraisal value... $20K-$60K lower than the apparent fair-market-value, if we sold it.
Is this contested now? Should I hire a mediator? Lawyer? Etc?
A: The fair market value of the residence is what a willing buyer would pay to a willing seller in an arm's length transaction. The appraised value is an appraiser's expert opinion of the fair market value of the residence. The expert's opinion is only an opinion of fair market value. The only way to determine the actual fair market value of the residence is to sell it to a willing buyer. That is not always necessary and it is common to use an estimated fair market value based upon an appraisal. If you suspect the appraiser's opinion of fair market value is low, then you could have another appraisal done by a different appraiser, or have a different appraiser review the first appraiser's report to see if there are any mistakes in it. You should consult with an attorney to determine the best course of action given your specific circumstances.
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