Real estate in divorce

The Marital Residence

When neither party desires to keep their marital residence, the process for dealing with the home in a divorce is straight-forward. The home is listed for sale and the net sales proceeds are distributed. This distribution can be split evenly between the spouses, one spouse can receive all the proceeds or a greater share than the other, or the proceeds can be used to pay off debts before being split between the spouses.

In addition to how you divide the net sales proceeds from your home, you will want to take into account issues such as who gets to live in the home while it is listed for sale, who pays the mortgage during the sale, how repairs are handled, will there be reimbursement for mortgage payments or repairs, and what happens if spouses cannot agree on a sales price. However, if one or both parties desire to keep the home it can become more complex.

First the home value will need to be determined. Sources used can be a tax appraisal values or listings on real estate websites, such as Zillow or Redfin, but there will often be drastic differences between these values.

If only one party desires to keep the home, it is common for that party to value the home at a lower amount and the other party value it at a higher amount. When this happens sometimes an appraisal may be necessary to bridge the gap and assess a value for property division. As part of property division, the spouse who does not desire to keep the home is often compensated for their share of equity by receiving other community assets or taking on less debt.

Separate Property Real Estate

If one spouse owned your home prior to marriage, and they did not transfer their ownership interest in the home during the marriage, then the home is considered that party’s separate property and the court cannot divest that spouse of their separate property.

However, the community estate may have a claim to equity in the home if community funds were used to pay the mortgage or for remodeling. When community funds go directly to increasing a home’s equity then a reimbursement claim can arise. However, equity increases due solely to market conditions are not subject to a reimbursement claims and will be considered separate property.

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This page has been written, edited, and reviewed by a team of legal writers following our comprehensive editorial guidelines. This page was approved by Founding Partner, Constance Mims who has over 15 years of experience practicing exclusively family law. Mrs. Mims is Board Certified in Family Law, by the Texas Board of Legal Specialization.

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