For most divorcing couples, money and time with the children will be the two biggest points of contention in the divorce. Child custody is a complicated situation, but that doesn’t mean that asset division is simple. In fact, the possessions and debts people acquired during marriage are often complex.
Many assets exist in strange legal gray areas, making it hard for those considering divorce to understand the potential financial impact of that decision. Major assets, such as your retirement accounts or marital home, can often become the sole focus of asset division proceedings.
There are many factors that can influence how the courts deal with the home you shared during your divorce.
Is your house marital property or separate property?
One of the most important questions to answer about ownership of your home is whether the courts will consider it marital property owned jointly by both spouses or separate property owned only by one spouse. For most assets, items owned prior to marriage are separate property.
Items purchased with money owned before marriage or inherited separately are separate property. Most gifts and inheritances are separate property as well.
Many times, individuals use money from before their marriage to buy a home. Other times, they may inherit a nest egg that they used to purchase property or they inherit a family home. Depending on the circumstances, the courts may treat the house as separate property in any of those circumstances.
However, it is likely that even if one spouse owns the house outright prior to marriage that the other spouse contributed to the financing and maintenance of the home. The courts will likely consider that contribution, as well as the length of the marriage, when determining how to handle the house.
In most cases, such as those involving a shared mortgage or a house purchased during the marriage, the home will be marital property. That means it is subject to division in the divorce.
Does retaining possession really matter to you?
When people talk about the home in the divorce, they often focus on possession, which is the act of living in the home.
However, your ownership interest does not just involve possession. It involves the financial value or equity that the home represents. Fighting for the home could just mean fighting for a share of its value, not the right to live there.
If you don’t care so much about living in the home, what matters most is obtaining a fair share of the equity.
Conversely, if staying in the house is very important, you should adjust your legal approach to the divorce accordingly. Anything from arbitration to mediation could help you have more control over the outcome to ensure that you secure a positive resolution regarding the family home.