Gray divorce — divorce among couples 50 and older — has roughly doubled in rate over the past three decades. On Long Island, where home values are substantial, the financial stakes are particularly high. The family home is almost always the largest asset on the table, and figuring out what to do with it is one of the most consequential decisions either spouse will face.
The Problem Most Couples Face
In a typical gray divorce on Long Island, the home might be worth $500,000 to $800,000 or more — often with the mortgage paid off or nearly so. The equity needs to be divided fairly, but the options most people default to create problems:
- Sell the home and split the proceeds. Both spouses lose stability. Both face Long Island's competitive housing market with half the equity. Neither may be able to afford a comparable home.
- One spouse takes a traditional mortgage to buy out the other. On a single retirement income, qualifying for a conventional mortgage is often impossible — or the resulting payment is unsustainable.
- One spouse takes a HELOC to fund the buyout. This adds a significant monthly payment on top of a fixed income. At current rates, a $250,000 HELOC could mean $1,500-$2,000 per month.
The HECM Alternative
A HECM offers a different path that most divorce attorneys and financial advisors on Long Island don't know exists.
The spouse who keeps the home uses a HECM to buy out the departing spouse's equity share — with no required monthly payment on the new loan. The departing spouse receives their share in cash, cleanly and completely. Both parties move forward.
Two Paths, One Tool
The HECM can help either spouse, depending on the situation:
Path A — Keep the home: Use the HECM to generate the cash needed to buy out the departing spouse's share. Stay in the home. Maintain stability. No monthly mortgage payment.
Path B — Buy a new home: Sell the marital home, split proceeds, and use a HECM for Purchase (H4P) to buy a new primary residence — with no monthly payment on the new home. Right-size to a home that fits a single-person household while preserving more of the sale proceeds for retirement.
Why This Matters on Long Island
Long Island's housing costs make this equation particularly acute. A single retiree trying to maintain housing stability on half the income and half the assets faces a much harder math problem here than in markets with lower home values. The equity locked in a Long Island home is both the challenge (it needs to be divided) and the solution (it can be deployed strategically).
A Sensitive Topic, Handled Carefully
We understand that divorce in retirement is deeply personal. We don't treat this as a sales conversation. We treat it as a planning conversation — one where your stability and well-being come first. If a HECM isn't the right tool, we'll tell you. And we're happy to coordinate with your divorce attorney, financial advisor, or mediator to make sure everyone is working from the same information.
Most divorce attorneys on Long Island don't know this option exists. Neither do most financial advisors. That's the gap we help close.