If selling is not an option, I recommend a quit claim deed as it is most cost effective.
The divorcing couple are essentially your tenants, which can become ugly considering they have ownership interests in the property.
You can do a quit claim deed were the divorcing couple remove their names or ownership interests in the proeprty. You then find other tenants. Of course, I have no idea how you hold title currently, but you should definitely speak to an attorney.
A quit claim deed can be the lease expense solution. The other is to sell and depending on when you purchased, you could have negativeequity and all parties would have to sign the contract, which I am not sure if this is a viable option for you on different levels. You may not want to move, it may be difficult to decide how to divide the proceeds if any!
In Union NJ, we helped two sisters separate deed on a duplex and I've seen some multifamily homes (2-3 story properties) that are essentially condos.
So, to answer your question of can it be done: Yes, but that avenue can be costly: 20k is my guestimate.
I have two attorneys I can refer you to where there main focus is real estate:
Email me if you want their names and numbers: firstname.lastname@example.org
There are 2-unit condos in New Jersey, many have been built in Bergen County in areas like Palisades Park. However, I suspect it would not be cost effective with legal fees. And you would have difficulty in selling either unit due to financing. An appraiser would have no comparable sales to utilize so delivering a credible appraisal for financing purposes would be very challenging. Additionally, there are zoning issues to be dealt with. Since it is an unusual form of housing, the municipality might throw up some resistance or make it onerous in some other way, especially if the home is considered a legal non-conforming use, which is the case with many 2-family homes in northern NJ.
An easier solution would be to just sell it. Of course, accomplishing that with a hateful divorcing couple in the way will probably be impossible.
A difficult problem. Do make sure the mortgage and taxes get paid somehow, or their miserable divorce will become your nightmare as well.
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