Dick is 25 years old and single. He buys himself a house.
Five years later, he meets Jane and they fall in love, get married, and live in the house.
Twenty-five years later, they fall OOL* and are heading toward divorce.
Is the house, by this time, considered joint property (owned equally by Dick & Jane)?
Thanks for any insight,
mmm
*out of love, of course
It depends on the jurisdiction (state or country), and it may also depend on what each brought to the marriage. (For example, did Jane’s salary help pay off the mortgage, or was she a full-time housewife all those 25 years?)
If there are kids of the marriage still living in the home, more often than not the wife will get the home and custody (or shared parenting) of the kids. If there are no kids, the court may order the house sold and the husband and wife split the proceeds.
But a divorcing couple can agree to pretty much any division of property that they wish, subject to the court’s approval, which will be routinely given unless there’s an obvious reason why it shouldn’t be.
Did Dick put Jane on the deed? If so, she is co-owner of the house. If not, it’s for the divorce judge and the attorneys to decide who gets what.
If Dick owned the house outright before he got married, meaning no mortgage on the house before they got married, he could claim it was a pre-marital asset. However, most likely at age 25, the house had a mortgage on it, which was paid over the 25 years they were married. It doesn’t matter if Jane worked or not. In fact Jane’s staying at home and taking care of the house and any kids could be viewed as supporting Dick in his job to help pay for the house.
Generally, the fair value of the house less any remaining mortgage on it at the time of the divorce, will be just one of the marital assets that will need to be divided.
Typically after 25 years, there probably is no pre-marital property and everything is a joint asset. So you add up all of the joint assets:
Cash and investments
Pension and 401k
Home and other property
Cars
Household goods, etc.
and deduct all joint debts:
(credit card)
(mortgage)
etc.
The net amount is the total joint assets and normally each sppuse would deserve to receive half. One spouse may take the house the mortgage and the value of that amount may be used to reduce their share of other assets they would get. As noted above, sometimes the house must be sold in order for each person to get their share of the total assets.
Laws will vary from state to state, but the above is generally how a house would be treated in a divorce. And of course the two parties can normally agree to whatever split they wish…if they can agree.
My brother was quite happy when he found out that his soon-to-be ex-wife had no claim on the house because he *inherited *it from our great aunt. Hence he didn’t have a mortgage and she had no claim despite them being married (& having kids) for years before they moved in.
Half the marrital assets go to eadch party as a starting point down under. and then the trouble starts!
As a general rule we accept that a full time house wife is entitled to half the assets, there are decisions then made around future income and custody issues. Custody payments are made as a % of income.
IANAL but as I understan it, the concept in Canada is that the “family home” despite it’s original title, eventually becomes joint property subject to the 50-50 split. The courts do have a bit of discretion - after 2 years and no kids, she’s not going to get half of a $500,000 house unless she has good lawyers. After 10 years, he better have the darned good lawyers or offer her a lot of alternative cash.
OTOH, generally there’s no alimony (just child support) unless it’s been 25 years of her sacrificing her career to put his house and children first. She might get a couple years of bridge financing to “get back on her feet” and find a career.
In the scenario mentioned, a lawyer once told me - inherited property does not become part of the family assets unless it is made part of them. Owning an income-producing business that you inherited, or a pile of money in the bank, or stocks - OK, untouchable. Once the inheritance becomes the family house, it will be treated as family assets.
SO your brother should be happy he lived in a less man-hating state than Canada.
My divorce was driven by my desire to restart on my own, so I simply signed the house over to my wife, and she then refinanced the mortgage to be in her name alone. She saved a bundle of money, too; since she did it right before the bubble burst, it appraised at considerably more than we’d paid for it 8 years earlier, so in addition to getting a lower rate, she was able to quit paying mortgage insurance.