After closing

Reading the closing statement

The closing statement is the receipt for the whole sale. It runs to a few pages. Both of you should get the same copy, and it's worth sitting down with it, separately if you like, while the details are still fresh enough that you'll remember what a credit or a fee was for.

Line by line, it shows where every dollar went:

• The sale price, and any credits you gave the buyer for repairs or closing costs.
• The payoff of each loan against the house, and any other liens.
• The commission and the other costs of sale, like title and escrow fees and recording charges.
• Property taxes and other costs divided between you and the buyer as of the closing date.
• The net proceeds: what's left for the two of you.

How the money gets paid

The title company doesn't decide who gets the proceeds. It follows written instructions, and in a divorce those come from your signed agreement, your attorneys, or a court order. Sometimes the money is split at closing. Sometimes it's held until the judgment.

Either way, nobody gets paid on one spouse's say-so. If the instructions aren't settled by closing week, that's a problem to raise with your attorneys at once. When an Oregon court divides property, it considers reasonable costs of sale and taxes (ORS 107.105), which is part of why those instructions are your attorneys' work and not mine.

If a number looks wrong

Check the closing statement against your own records before you file it away. Compare the loan payoffs with your last mortgage statements, the credits with what the sale agreement said, and the split of the proceeds with your written instructions or the court's order.

If something doesn't match, raise it quickly. Write to me on the shared thread, and if the question is about how the money was divided, copy both attorneys. I'll get the title company's explanation in writing and send it to both of you at the same time, so neither of you hears a different version of what happened to your money.

It may turn out to be a small thing, like a proration date. Ask anyway.

Keep these records

Your CPA will want the paper trail, possibly years from now. Download everything from the shared folder before it's closed, and each of you keep your own copy somewhere you'll still be able to find after two moves, a new email address and a few tax seasons have gone by. Don't rely on me to have it.

• The final closing statement for the sale.
• The closing statement from when you bought the house, if you can find it.
• Receipts for improvements over the years, like a remodel, a new roof or an addition.
• The final mortgage statement and the payoff confirmation.
• Your signed agreement or court order about the sale and the proceeds.

Tax questions for your CPA

I'll tell you what IRS Publication 523 says, and your CPA will tell you what it means for you. A seller who meets the ownership and use tests can exclude up to $250,000 of gain on a main home, or $500,000 for a married couple filing jointly. Filing status matters here.

Pub 523 also lets you count the home as your residence while your former spouse is allowed to live there under a divorce or separation instrument and uses it as a main home. And it treats divorce or legal separation as an unforeseeable event that can qualify for a reduced exclusion. Bring all of this to your CPA, along with the records above.

Close out the loose ends

A sale leaves a short list of accounts to shut down, and in a divorce it's worth deciding in writing which of you handles each one, so the water bill doesn't keep going to an address neither of you lives at.

A few calls finish it. Cancel the homeowner's insurance once the deed has recorded, and check with your insurer about any refund of the premium. Close or transfer the utilities as of the closing date. Forward your mail.

The mortgage is paid off at closing, which ends the joint loan. That's one thing a sale does that a quitclaim deed can't: the loan is a contract with the lender, and only a sale, a refinance or the lender's own release ends it. Keep the payoff letter.

Your next home

Each of you can buy your next home on your own, in your own time, and I can help either of you. If I help one of you buy, I work for that person in that purchase, and the other spouse doesn't get updates on it, any more than a stranger would. That's a clean line.

Anything either of you told me in confidence during the sale stays confidential after the agency ends (ORS 696.805). That's the law, and it's how I'd work anyway. If you'd rather use a different agent for your purchase, that's entirely fine, and I'll send your records along when you ask.

If you're both buying at around the same time, I can work with each of you as a separate client, on separate timelines, with nothing from one search shared with the other. You may like that continuity, or you may want an agent who wasn't part of the sale. Either way, I'm glad to talk it through. Call me at 541.784.7745.