Handling Property the Smart Way in a Divorce
40% to 50% of marriages result in divorce in the US. For those aged over 50, there has been a 109% increase in divorce rates between 1990 and 2015. During a divorce, most assets can be sold and proceeds split down the middle, with each spouse taking half. The family home is one of the most contentious assets during a split because of both its financial value and the emotions attached to the property itself.
Understanding Community Property
The state of California in the US is a community property state, implying that all the debt and property acquired while in marriage must be split down the middle when a couple is divorcing if they fail to agree on another solution. The courts assume that all properties acquired during the duration of the marriage are community property that is owned jointly by the partners. The exception to this assumption is when there is documentary evidence clearly stating that the property was acquired as separate property. However, the court can decide to give the whole property to one spouse even if the property was a joint estate.
Factors to Consider in Community Property
According to the family code in the state of California, sections 760, 770, 772, and 2550 define the community property and circumstances when a property may not be community property. When splitting a community property, the total fair market value for the property is taken into consideration, and the joint obligations of the spouses subtracted giving the net value of the community estate. Each partner will take half of the net unless it is agreed otherwise.
The Marital Home
When children are involved who are minors, the primary parent who will be taking care of them could be allowed to remain in the marital home. However, the spouse living in the house has to pay the mortgage, homeowners’insurance, and other taxes. The other spouse may also be required to make those payments if there is a significant disparity in their resources or income. Later, the house must be sold when the children are no longer living with the parents or when the youngest child reaches adulthood.
Does It Matter Whose Name is on the Deed?
Even in a situation where one spouse has the name on the title, the law in California does not give much weight to this scenario, and it would still be considered as community property. Therefore, if your name is on the deeds, you still need to discuss in length with your attorney, because this is a gray area in the divorce law in California. The state always freezes mortgaging or the sale of a home during a divorce. During this time, a court or spouse approval is needed to put the house on the market. Besides, the spouse may also file a ‘Lis Pendens’ or a lien stating that there is a claim to the title. If you decide to stay in your home during the divorce, this could also mean that you have to provide temporary support payments to your spouse. Your spouse could also be living in the house temporarily as the court may instruct.
As with all other aspects of divorce, it is essential that you seek legal counsel as soon as you decide to separate. Ensure that you are well versed in your rights and use experts to help you resolve the sale of your property quickly, so you can move on with the rest of your life.
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