Everyone has heard the phrase, “First comes love, then comes marriage, then comes baby in the baby carriage.” The saying fails to mention when couples normally purchase their first home together within this sequence.
Today, many couples are even buying a home together before getting married. CNBC reported that only 57% of couples who own their first home are married, compared with 75% of couples in 1985.
Below we have listed some information on the basics of property allocation for couples who are purchasing their first home together. To discuss specific concerns, speak with our family law attorneys from Mims Ballew Hollingsworth, serving Southlake, Fort Worth, Denton, and nearby cities.
Community versus Separate Property
Texas is one of nine states that abide by the law of community property.
The law of community property states that property acquired by either spouse during the marriage is owned equally by both people. This applies to real estate, retirement accounts (i.e., IRAs or pensions), personal property, and even debts.
Community property does not apply if one spouse acquired the property through an inheritance or a gift. Additionally, if a person bought a house before getting married, the property might be considered separate property. However, if the non–owner spouse contributes to the mortgage and lives in the home, the equity earned during marriage can be community property.
The Inception of Title Rule
In Texas, a Court will want to examine the circumstances behind a real estate purchase to determine if it is separate or community property. This is done through the inception of the title rule.
The inception of title is determined by the date that a person first has a right to claim ownership of a property. For example, when purchasing a home, the date of inception of the title would be when the security deposit is paid to the seller, sometimes referred to as “earnest money.” The date of inception can be prior to or during the marriage.
If one spouse did not contribute an equal share of the down payment for a home, then they would not technically own a 50/50 separate interest in the property. Rather, the split of ownership would be based on what percentage each person contributed to the down payment for the home.
Conversely, if one spouse bought the house with their own money, then they would own the property separately. This applies even if both their names are listed on the deed.
Can a Prenuptial Agreement Protect My Property?
In Texas, a prenuptial agreement, or a premarital agreement, can handle how assets and debts accrued during a marriage are divided upon divorce.
Under the Texas Uniform Premarital Agreement Act, the couples entering into the agreement can contract on the following:
- The spouses’ rights to buy or transfer property;
- The spouses’ rights and obligations regarding the property they obtain; and
- The disposition of the property upon separation, divorce, or death.
It is wise to have a prenuptial agreements attorney review your premarital agreement in order to ensure that it meets all the requirements necessary to be a valid contract in Texas.
A Family Law Attorney Near You
Buying a house with your significant other may seem like a good idea at the time, but can cause complications in the future. The family law attorneys at Mims Ballew Hollingsworth⏐Family Law are well-acquainted with Texas law and are here to answer any questions you may have. Contact us today to schedule a consultation.
Content reviewed by a Board Certified family law attorney Constance Mims.
Frequently Asked Questions
Yes. In Texas, property acquired during marriage is generally considered community property, meaning both spouses share equal ownership, regardless of whose name is on the title.
A home bought before marriage is separate property, but if the non-owner spouse contributes to the mortgage or improvements during the marriage, equity earned may be treated as community property.
The inception of title rule determines property ownership based on when the right to acquire the property began, such as when earnest money was paid. This rule helps courts decide whether a home is separate or community property.
A valid prenuptial agreement can specify how property and debts will be classified, managed, and divided in the event of divorce, giving couples more control over ownership rights.
Even if both names are on the deed, the property may be separate if purchased with one spouse’s funds before marriage. However, contributions made during marriage can still create a community property interest.
Yes. Texas recognizes same-sex marriages and common law marriages. Couples who meet the legal requirements have the same property rights as any other married couple.
