How does my house get divided in the divorce?
- posted: Apr. 04, 2019
California is a community property state, meaning that there is a presumption that any property acquired during the marriage belongs to both spouses equally. In other words, both spouses will have an equal interest in their house, assuming it was purchased during the marriage with marital funds and both spouses are on the title. However, as with many physical assets, literally splitting the house in half is not a realistic option. So many divorcing couples are left with the question: who gets the house?
Generally, divorcing couples have three options when deciding how to divide the house. Many spouses find that selling their home and dividing the proceeds equally is the best way to ensure that both spouses get what they are entitled to. Keep in mind that any money you and your soon-to-be ex make on the sale of the house could be subjected to capital gains taxes. Also, if you sell the home, both you and your spouse will have to find a new place to live. Whether you rent or buy, you will need to make sure you (and your spouse) are financially stable enough on your own to afford the costs of a new home or apartment.
If selling your home is not an option, allowing one spouse to continue living in the home is a possibility. After calculating the current value of the house and making necessary adjustments, the spouse who stays can buy out the other spouse’s share of the home. The spouse that stays will be the only one listed on the deed and they can refinance the mortgage to protect the other spouse’s finances and credit.
For couples with young children, or couples who are struggling financially, maintaining joint ownership of the house may be the best option. One spouse may decide to stay in the house with the children while the other moves out. In such cases, you and your spouse will need to work together to come up with a reasonable way to split household expenses.