Under no circumstances should you agree to vacate your home, not even temporarily. If your in-laws are not comfortable seeing you, then they can get a hotel. If they can't afford a hotel, they can stay home.
WAW's with kids are always trying to convince the H to move out. Why? Because they can't abandon their children, and they can't take them with them without a custody hearing. If you move out you are at a disadvantage regarding custody and keeping the house.
You can do a lot to separate finances without filing. Simply move your money out of joint accounts, and cancel any joint credit cards. As for the home equity line of credit, see if they will cap it.
If you do file, one of the first things your L should do is get a restraining order, preventing either of you from incurring new joint debt and from liquidating property.
