No matter how many assets you’ve accrued during your marriage, chances are good that your marital home is the most significant, both emotionally and financially. Your home represents a massive amount of your income for most couples. The equity in the home may be the single most substantial financial asset in your family, except for a well-funded retirement account or investment portfolio.
It’s only natural, then, to wonder how the courts will handle your home in a divorce. Every divorce is unique, which means accurately predicting the outcome is impossible. However, it is possible to familiarize yourself with the most common solutions to dividing a home in a Texas divorce.
The courts often consider homes community property
If you have a prenuptial agreement, it may address how to split up the home, who will stay in the house or other similar issues. For couples without valid prenuptial agreements, however, there’s less certainty about the outcome. In most divorces, the marital home is community property. If the couple bought it while married or paid the mortgage out of marital funds, that means the courts will likely consider both spouses to have an interest in the property.
If the home was an inheritance by one spouse prior to the marriage or if one spouse owned the home outright before marriage, it may be separate property not subject to division. In most other cases, however, the home will be subject to division.
Sometimes, one spouse gets to stay in the home
The courts consider many factors when deciding what to do with the marital home. Child custody, especially of children with special needs, can impact the outcome of this process. So can the ability to obtain and pay a mortgage on the property and the economic circumstances of each spouse. The courts want to minimize disruption to the daily lives of the children and keep them in the same schools if possible.
If the courts award possession of the home to one spouse, he or she will need to refinance the home. This removes the other spouse from the mortgage note and the deed for the property. The spouse who moves out will generally receive a portion of the equity in the home or valuable assets of comparable value, like a retirement account.
In some cases, the house may end up sold
If your family owes more on the home than its current value (called being underwater on your mortgage) or if you have very little equity, the courts may simply order the sale of the home. The spouses will typically split any income or proceeds from the sale. The home may also end up sold if neither you nor your spouse can secure financing for the property on your own.
While it can be frustrating or heartbreaking to say goodbye to the family home, in some cases, moving on to a new home is a better decision.