Dec102025
Family Law Q&A Series

Can we use a separation agreement to sell the house with little or no equity, and how do I make sure the sale actually happens if the other person stalls? – North Carolina

Short Answer

In North Carolina, a properly drafted, signed, and notarized separation agreement can absolutely require both spouses to list and sell a marital home, even if there is little or no equity. The agreement can spell out how the listing will occur, who picks the agent, how to handle a short sale or closing costs, and what happens if one spouse refuses to cooperate. If a spouse later stalls or refuses to sign documents, the other can seek enforcement in district court, including specific performance, contempt, or a court order that transfers or approves the sale without the noncooperative spouse’s signature.

Understanding the Problem

The core issue is whether North Carolina family law allows spouses who are separating to lock in, through a written separation agreement, a plan to sell a jointly owned home that has little or no equity, and how to ensure that the sale actually happens if one spouse drags their feet. The question sits squarely in the areas of separation agreements, equitable distribution of marital property, and enforcement of contracts between spouses. A typical scenario involves spouses who co-own a marital residence, agree in principle that it should be sold because it has minimal equity or may even be underwater, but one spouse worries that the other will later refuse to list the home, turn away showings, or refuse to sign the closing documents, delaying the financial clean break and the divorce process.

Apply the Law

Under North Carolina law, spouses may enter a written, notarized separation agreement that divides marital property and sets out how and when to sell a home. That agreement is treated as a binding contract and can also serve as a property settlement under the equitable distribution statutes. The district court has authority to enforce separation and property settlement agreements and to order parties to comply or face sanctions. When real estate is involved, the agreement can also authorize one spouse to sign necessary sale documents or can be enforced through court orders that transfer title or approve a sale if someone refuses to cooperate.

Key Requirements

  • Valid written separation agreement: The spouses must sign a written agreement, acknowledged before a notary, that clearly states they are living separate and apart and sets out their property division and sale terms for the marital home.
  • Clear sale provisions for the house: The agreement should specify that the house will be listed for sale, define the listing price or pricing method, explain who chooses the real estate agent, how reductions and offers will be handled, and how any net proceeds or losses will be allocated.
  • Enforcement and remedies if a spouse stalls: The agreement should state that either spouse may seek enforcement in North Carolina district court, and may request specific performance, contempt remedies, or court orders to sign or transfer documents if the other spouse fails to cooperate.

What the Statutes Say

Analysis

Apply the Rule to the Facts: In the facts described, the marital home is jointly owned and has little or no equity, both spouses are open to selling, and one spouse is concerned about being left hanging if the other later resists. A North Carolina separation agreement can treat the house as marital property under § 50-20 and spell out a step‑by‑step sale plan (listing, pricing, reductions, approval of offers, and allocation of any deficiency). Because the agreement can be enforced as a contract in district court, it provides a concrete remedy—like specific performance or a court order transferring or authorizing the sale—if a spouse later stalls, making it more likely that the sale actually goes through.

Process & Timing

  1. Who files: Either spouse. Where: In the North Carolina district court for the county where either spouse resides, if court enforcement becomes necessary. What: First, the parties usually sign a notarized separation agreement and property settlement that addresses the sale of the marital residence and any alimony or vehicle issues; later, if needed, a complaint or motion in the cause for enforcement of the agreement or for equitable distribution. When: A separation agreement can be signed any time after spouses begin living separate and apart; an equitable distribution claim is typically filed before or at the time of the absolute divorce to preserve property rights.
  2. Once the agreement is signed, the parties (or the spouse in charge of the sale) engage a real estate agent, list the property, and follow the pricing and sale mechanics in the agreement. If one spouse refuses to cooperate—for example, by refusing showings, blocking offers, or refusing to sign closing documents—the other may file a court action asking the district court to enforce the agreement, order specific performance, or, if appropriate, hold the noncooperative spouse in contempt.
  3. After the court reviews the separation agreement and the facts, it may enter an order requiring compliance, approving a particular sale, or transferring title under the North Carolina Rules of Civil Procedure if necessary to complete the closing. The final outcome is usually a court-enforceable order and recorded deed or other closing documents that remove the house from joint ownership and settle any net proceeds or shortfall as described in the agreement.

Exceptions & Pitfalls

  • If the separation agreement is not signed and notarized as required under North Carolina law, it may be difficult to enforce as a binding property settlement in district court, especially for real estate.
  • Vague sale terms—such as saying only “the parties will sell the house later” without deadlines, pricing methods, or default rules—make enforcement harder and give a stalling spouse more room to argue.
  • If the separation agreement is not recorded (or a short memorandum is not recorded) in the county where the property lies, third‑party buyers and title companies may hesitate to rely on one spouse’s authority to sign alone, even if the agreement says so.
  • Where the home is at or below break‑even, the agreement must clearly say who covers closing costs, any deficiency, or needed repairs; failing to address these items can cause last‑minute disputes that derail a closing.
  • If no equitable distribution claim is filed before the divorce, court‑ordered property division later will generally not be available, which can limit leverage to deal with a stalling spouse.

Conclusion

North Carolina law allows spouses to use a written, notarized separation agreement to commit to selling a jointly owned house, even when there is little or no equity, by treating the home as marital property and laying out clear sale terms. The key is to draft specific listing, pricing, and closing provisions and to include enforcement language so the district court can order compliance if a spouse stalls. To preserve stronger enforcement options, the safest next step is to sign a compliant separation agreement and, if appropriate, file an equitable distribution claim in district court before or with the divorce.

Talk to a Family Law Attorney

If you’re dealing with a North Carolina separation involving a jointly owned home, little or no equity, and concerns about a stalling spouse, our firm has experienced attorneys who can help you understand your options and timelines. Call us today at (919) 341-7055.

Disclaimer: This article provides general information about North Carolina law based on the single question stated above. It is not legal advice for your specific situation and does not create an attorney-client relationship. Laws, procedures, and local practice can change and may vary by county. If you have a deadline, act promptly and speak with a licensed North Carolina attorney.

Category: Family Law Q&A Series

Author: jpierce

Attorney Jared Pierce is the founder of Pierce Law Group in Raleigh, North Carolina, a firm he established with a dedicated focus on probate administration and estate planning across North Carolina. Born and raised in the Republic of South Africa, Jared moved to Durham with his family in 2001, bringing with him a rich cultural background and a distinctive accent that often serves as a conversation starter.