Navigating Divorce Real Estate: An Expert Guide With Rachel Vesta

Rachel: So my professional background is five years in real estate. Before that, I spent 15 years in education—educational leadership, school development, and teaching. That was my pre-real estate world. The reason I got into divorce real estate as a specialty was because of my own experience. I had gone through a divorce myself. There was real estate involved in the dissolution of my marriage, and despite having counsel and a real estate agent working for me, there were things that were missed that could have been bad. I could have lost my homeownership eligibility, which would’ve been devastating for me, especially as the primary caretaker of three kids.

All that because of a court order that didn’t include sufficient language for real estate, not enough consideration for how to protect my homeownership eligibility, or how to calculate and qualify for a loan on the other side, and what factors needed to be included in that process. I didn’t know any of that, so I learned it. And I started specializing in divorce real estate with some additional education through a designation that I had in divorce. It was a one-week introduction to real estate. A lot of things that I knew because I had been through a divorce. So there was a lot that I knew, but it allowed me a starting place for specializing in and supporting divorcing homeowners.

A year ago, I was invited to apply for a role as a certified divorce real estate expert (CDRE), which was completely another level of training and experience requirements for divorce-related real estate transactions. As a certified divorce real estate expert, our role is to support the family law community from the attorney’s standpoint. We are there to support attorneys and their clients who will have real property that needs to be valued, divided, whatever the case may be, related to real estate so that they have that additional expert.

Rachel: I want people to know that if they don’t know who to call, just call me directly. I continue to put my story out there so that the divorcing homeowners themselves can individually hear about me. However, I can make a bigger impact by connecting with family law attorneys because of the volume of transactions that they do with real property. So clients may reach out directly, attorneys may give my name to their clients, or I may be appointed by the court.

Rachel: It’s just like any other expert; there has to be a good understanding of, “Why would we need to involve this expert?” So, understanding that there is a specific language that comes from my side that wouldn’t be known otherwise is essential.

There are a lot of preventative steps that I can help do to make the listing process smoother. Parties will be exploring, “Can one party keep the house? Are there buyout options? Do we need to sell this house?” So there are decisions to be made. And so, at the front end, I provide information to both parties. We can help them explore what inspection items might come up, should they have to sell, or if one party is keeping the house, that they’re informed about what they’re keeping.

So the first step could be an attorney giving me the name of the client. Or it could be either one of the spouses calling me. I would start with whoever called me first with an intake form. So there, we’re getting a lot of information about the property. And then, I would have the same intake process with the other spouse. So both parties are aware of what’s happening, and we start to get clarity and see where everything is. Then I would reach out to the attorneys and introduce myself, let them know that the parties have asked me to be part of this.

Rachel: Well, there are a few things to be thinking about if it’s been decided that the property is going to be listed, so we’ll be thinking about it from that perspective. There are two parties here that are not necessarily in agreement about what happens next. So they need a person, a neutral party, an unbiased party, of which their attorneys are not that; that’s not their role. So I play the role of a third party that is a neutral, unbiased party to interact with them in a way that makes both parties feel heard and have equal communication, to value the house and agree on a list price.

Agreeing on a list price can be a problem. Sabotaging showings—if there is one party that may not be ready to sell the house, it may be what’s happening. There are a lot of emotions in divorce, and that’s why we have processes to help limit and also resolve when sabotaging of showings is happening.

The main difference with a traditional sale is that there usually are two people who are excited about moving to a new house, and their goals are more aligned. They are on the same team.

Divorce is different. Emotions can cloud things, so it’s really important to have processes anticipating these things could be a problem, and cut them off at the front.

After the intake process, we’d schedule a walkthrough that would be coordinated with whoever is living in the house, and we’d be building our file. At this point, we need to check a few things: court orders, restraining orders, preliminary title work, mortgage payoff documents, or mortgage documents. We want to start gathering what the numbers are that we’re looking at. Then I have a listing consultation with each party separately. And then, we would establish a working relationship before moving forward as the listing agent.

Everything is addressed with each spouse separately. Then we check in with the attorney, without burdening them, and let them know that the listing paperwork has been signed. Now we’ve established our relationship. As you can see, there’s so much front-end work in this.

Rachel: Training is a lot of it. Mediators are trained, and judges are trained. When you’re working in a neutral, unbiased role, there is a lot of training and practice and reflection and acknowledging where you may be more likely to have a bias, maybe even because of a personal experience. Being aware of that, and then being trained and skilled to then not let that affect your role in this transaction is such a huge piece. This is also why we have very strict processes because it helps to keep the process moving and keeps the focus on the house.

Of course, we have compassion for these families restructuring their lives and dissolving their business connections that are involved in the house contract that they have. Which leads me to a very important piece: who’s on the title? Often, it’s not looked at until later in the transaction. But as a real estate agent, our only client is the one who is on the title. So how the court recognizes the owners of the home and how the real estate perspective recognizes the owners and decision-makers of the home could be two different things.

So we need to make sure that on the real estate side, we’re working within our scope, within our contracts. So we add a stipulation to those contracts; if there’s one party who’s not on the title but is a decision-maker for the home, we need to add language to our listing agreements to include that party as a decision-maker, as someone we can communicate with. Because if we don’t have that, we can’t communicate with them.

Rachel: I would advise them to call a CDRE and start that process for both parties. It is in-depth, and we’ll give them all the answers. It doesn’t mean that they’ll end up listing the house, but it will help them start the process of valuing things. So build the team, get a CDRE, and go to a certified divorce lending professional, also known as a CDLP. And that is my equivalent in training for the lending side. Divorce lending is its own thing. There are a lot of nuances in divorce lending that would be devastating if they were overlooked. Both parties should be looking at getting their pre-approval, looking at what their homeownership eligibility is, looking to see if any post-divorce decisions, and how it could affect their lending so they can help make better decisions in the divorce process. It may affect how they handle child support, it may affect what they’re asking for alimony, and it may affect timelines for how long decisions and child support and alimony are paid because it will directly affect lending.

And a lot of divorcing homeowners, somebody wants to keep the house. That’s often a place where people start; somebody wants to keep the house. Before you get too hung up on that idea of being possible, start with a lending professional and see if it is possible. If it’s not possible, it is the best thing to know that early, and then move on to your other options. But if that is stuck in someone’s head, as likely what they will do, and overconfidence with their ability to do that because they haven’t talked to a lending professional, then you could get months and months and months into this process and then realize, “Oh, actually, I don’t qualify,” or, “That’s going to stretch me too much. That’s not the best decision anymore.” So first, very first, you get your team, you get your attorney, you get a CDRE, even before your attorney maybe, but you get your CDRE and you get your CDLP.