Divorce comes with many compromises. You and your spouse will have to decide how to split many things, including insurance, pensions, income, assets, child custody, and even the home you share. Many couples particularly struggle with the decision of what happens to their home. Often, people have a strong emotional attachment to where they live, and houses may have been handed down from generation to generation. Who will get to keep the house after a divorce is a decision that depends on the unique circumstances of the divorce. Some of the factors that may be a part of that decision include:
Children: If a couple has children, they may desire to try to keep the children in the home, and not force them to move. The trauma of the divorce, coupled with moving, can cause significant distress for children. The decision may be that the house will go to the spouse with primary custody of the children. A child psychologist or a therapist may be able to help with the decision.
Emotional attachment: Emotional attachment is a reason many people want to retain possession of the home. This is especially true if the home came from one spouse’s family as a gift or inheritance, or if it was built or remodeled by the couple to be their “dream home.” It is easy to argue emotional attachment, but often hard to defend in the divorce proceedings.
Who Owns the Home?
Before the home can be sold or otherwise transferred, ownership of the home must be determined. In California, property acquired during the marriage is assumed to belong to both spouses, known as “community property.” The property is considered to be owned equally, unless it was inherited by or gifted to one spouse. In most cases, both spouses would be listed on the deed and be joint owners of the property.
Occasionally, only one spouse will be listed on the deed, even if both contributed to the purchase of the home. This creates the presumption that the house is the sole property of the deed holder. This can be contested by showing that both spouses had an understanding that they shared ownership of the home, but this requires very strong evidence to argue.
A house bought before the marriage occurs is considered separate property, and belongs to the individual who purchased the property. If the other spouse has contributed to the mortgage or helped pay for improvements on the home, they have created interest in the home. The court will likely decide how much stake the non-owner has based on the amount they have invested in the home.
Ways to Handle Ownership of the Home
There are several ways ownership of the family home can be approached. Some couples may decide to get rid of the house completely, while others may work out which spouse is able to remain living there. Here are several options for deciding ownership of the home.
Sell and divide profits: Spouses may decide to sell the house and split the profits to avoid the decision of who keeps the home. If neither spouse can financially maintain the home, this may be the only option.
Buy out: One spouse may choose to buy out the other and refinance the home. This can be costly, but if the buyer has the financial means and desire to keep the home, this can be an agreeable solution. To determine if the spouse who wished to buy the house can afford to, they should consider:
- Monthly mortgage payments
- Insurance
- Utilities, repairs, and maintenance
- Property taxes
- Mortgage interest tax deduction
In some cases, one spouse may continue to pay the mortgage as a form of spousal support.
Deferred sale: If there are minor children involved, another option is for both spouses to remain on the title until the set period allowed by the divorce agreement passes, and then the house will be sold and divided. One spouse will be granted exclusive rights to occupy the home until the sale. Usually, the spouse who has primary custody of the couple’s children will remain in the home.
When the court or couple decide to defer the sale of the home, they must also determine if the spouses can afford to financially maintain the home. If the deferment is determined to be financially feasible, the court will consider other factors before making the final decision. These factors can include, but are not limited to:
- The amount of time the children have lived in the home prior to the divorce
- The children’s ages and grade levels
- The proximity of the home to the children’s school, child care, or other services
- If the home has been modified to accommodate a disabled child
- The emotional impact of moving
- The proximity to employment for the spouse who will remain in the home
- The financial ability of both spouses to find adequate housing
- Tax consequences of a delayed sale
- Other factors that affect the individual case
Making the Decision
Many couples will first try to work out the terms of the divorce with their lawyers and try to come to an agreement. If they are unable to reach a decision, the case will often go to court to be settled by a judge. For many couples, it is better to decide how to divide their assets on their own than to have a stranger make the decision, but it is possible they will not reach a decision on their own. This can lead to an expensive and lengthy court battle.
An experienced divorce attorney can help you mediate your divorce and reach an agreement. Our Newport Beach divorce lawyers are dedicated to helping you obtain a satisfying resolution to your divorce. Out skilled, knowledgeable team will advocate for you through every step of the process.
Contact Burch Shepard Family Law Group at (949) 565-4158 today to discuss your case.
