In Part I, we covered what may happen before a divorce. In this Part II, I will discuss what may occur once a divorce is filed and possibilities for when the divorce is finalized.
During Divorce Proceedings
Final Decree for Divorce
A Final Decree for Divorce is a court order that divorces the parties, and also works to divide the property. For the property to be divided, there must be a determination as to whether the property is separate or community property. You may know that Texas is a community property state, but what does that mean? The Texas Family Code tells us that, “community property consists of the property, other than separate property, acquired by either spouse during marriage.”
What Is Separate Property?
The Texas Family Code provides that, “a spouse’s separate property consists of: (1) the property owned or claimed by the spouse before marriage; (2) the property acquired by the spouse during marriage by gift, devise, or descent; and (3) the recovery for personal injuries sustained by the spouse during marriage, except any recovery for loss of earning capacity during marriage.” So, property falling into any of these three categories is separate property and any other property is presumed to be community property.
A house that is community property will get divided in the Final Decree. How that division happens is largely up to the parties. Typically, the options are: (1) sell the house and split any proceeds; (2) one spouse keeps the house and pays the other spouse half of the equity; or (3) the spouse not keeping the house receives other assets to offset the value of the equity.
After Divorce Proceedings
One of the benefits of agreeing on an option is control over the structure of the option. When selling the home, this means parties can work on a timeline for the sale as well as choose a realtor. If left to a judge’s decision, the deadline for the house to be listed on the market may not leave the parties with as much time as they would like. The judge may also appoint someone to handle the sale with whom the parties are unfamiliar. For parties wanting one spouse to keep the house, they can lose out on that chance by having proceedings go before a judge. If a spouse is going to keep the house, an agreement can be key. One of the things parties usually want is for the mortgage to be in that spouse’s name only. With an agreement, parties can work with the lender on refinancing options. Refinancing also allows an opportunity for the spouse not keeping the home to receive their equity. Typically, if the parties cannot agree on one of the options, a judge must divide the house, along with the rest of the marital estate, in a manner they deem just and right. Usually, this means a judge will order that the house be sold and profits split.
This post is for informational purposes only and does not provide legal advice on any subject matter. This post should not be used as a substitute for legal advice from a licensed attorney.
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This post is not meant to be exhaustive, but a brief overview of maneuvering through Family Court. Contact Whitbeck Bennett by calling 800-516-3964 or by emailing email@example.com, to connect with an experienced attorney in your area who can guide you through the process.