For many families, their house is the most valuable asset, so the question of what happens to the house is extremely important.  The answer can depend on many factors, so this article will give an overview of some of the possibilities and considerations.  If you’d like to understand how the law will impact your specific circumstances, contact  us at the Law Office of David W. Knecht for a consultation.  We have extensive experience in family law and can help you understand how the factors discussed in this article will apply to you, your property and your family. 

• Determine whether the home is separate or community property.

• Home purchased prior to marriage, generally separate.  If the home was purchased prior to the marriage by one spouse and no community assets were used to make payments on the home, then it would typically be separate property. This is a general rule and there may be exceptions which are beyond the scope of this article.   

• Home purchased during marriage, generally community.  If the home was purchased during the marriage, it is likely community property.  In California, the presumption is that property acquired during the marriage is community property and not separate property.

• Separate property means one spouse will get it, community property means it is a shared asset. If the house is separate property, the owner will get the house.  If the house is community property, the house can be divided between the couple by agreement or court order.   See https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?lawCode=FAM&sectionNum=2550 and https://codes.findlaw.com/ca/family-code/fam-sect-2581.html

which state that the presumption is that community property is divided equally. 

• Sell and divide profits.

The most obvious option is to sell the house and divide the profits between the spouses.  This is clean and is often perceived by the parties as equal.  This is a good option when neither spouse can afford the house alone. 

• Buy out.  

A buy out option is where one spouse pays the other their share of the value of the home and keeps the home.  This can be advantageous if the home if financed with a favorable interest rate, or if the home has special value in terms of sentimental value or location or design that can’t be duplicated by an alternative house. The spouse considering a buy out should weigh various factors such as the mortgage payments, interest, utilities, insurance and maintenance costs. There can be important tax implications to this decision.  For example, if by court order or agreement one spouse pays the mortgage as a form of spousal support, then the spouse paying the mortgage can claim a tax deduction for support payments, and the spouse receiving would need to claim the payments as support income.  Consulting a tax professional or your attorney on the tax consequences of the division of the house is a important step in the divorce process. 

• Deferred Sale

A court can enter a deferred sale order to benefit their minor children as a way of lessening the impact on the children.  With a deferred sale order, one spouse and the children stay in the home but both own the home jointly for a certain length of time.   (See https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=3800.&lawCode=FAM)

There are many important considerations when contemplating a divorce, and the division of the home is one of the most vital aspects to plan out in advance.  If you are interested in more information about how your home would be divided in a divorce, please contact the Law Office of David W. Knecht, at 707-451-4502.

Today’s article will be a question and answer about divorce basics in California with source material derived from:  https://www.courts.ca.gov/1032.htm

• Is divorce the only way to end a marriage in California?

No, divorce is the most common way to end the marriage, but annulment and legal separation should not be forgotten.  Legal separation may be the preferred in certain situations, for example, if a party can retain health insurance through the other spouse and continue empl9yer contributions.  In that instance, if neither party was eager for the divorce to be final or to remarry, then legal separation for a time may be more advantageous than divorce. 

• Is California a no fault state? 

Yes, California is a no fault state.  You do not have to prove a basis for a divorce and can obtain it solely on the basis of irreconcilable differences, which basically means you just don’t get along with each other. 

• Is it better to be the one that files first?

The party that files is not important from a judicial perspective.  The court doesn’t give any preference to the person who is first to file.  However, taking the initiative to get the case started may be an advantage or a disadvantage for your strategy in your specific case.  That depends on your personal circumstances and objectives.  

• Can a divorce impact my immigration status? 

A divorce may impact your immigration status, so it is important to get information on your circumstances as soon as possible.  

• Can a divorce affect my health insurance? 

Yes, if your health insurance is covered under your spouse’s plan, then it’s important to consider your health insurance options before finalizing a divorce.  There are different options for protecting your health coverage, and you’ll want to negotiate the best option for you. 

• Will a divorce limit relocation plans?

If you will be sharing custody of children, then divorce can affect relocation plans, so this is a vital consideration in the process if you are planning a significant move.  

• Where can I get help with a divorce to make sure I think through all the important concerns?

If you need help with a divorce, please contact the Law Office of David Knecht, at 707-451-4502.  We have extensive experience in family law and have the knowledge and expertise to answer your questions. 

Protecting your assets is one of the most important considerations when getting a divorce, and the home is typically the most valuable asset for most families.  A buyout is when one spouse wants to keep the house and decides to pay the other spouse for their interest.  A buyout might be preferable to one spouse for many reasons:  keeping continuity for the children, if the house is sentimental, to avoid the cost of moving, to avoid paying taxes on a sale of the home, if the house is financed with a good interest rate, etc.  This article will discuss the steps to work through to make a good buy out offer. 

• Determine who owns the home. 

California courts presume that a home acquired during the marriage is community property, meaning that the home needs to be divided 50/50.  However, the analysis of whether the home is community or separate property can be more complicated than that, for example, if the home was purchased prior to the marriage or if the home was inherited by one spouse.  Although a detailed analysis of these rules is beyond the scope of this article, the first step in the buy out process is to determine whether the home is, in fact, community property.   See https://codes.findlaw.com/ca/family-code/fam-sect-2581.html for the presumption that the home is community property. 

• Determine the value of the home. 

There are many ways to determine the value of the home.  The most thorough may be to obtain one or more assessments from a licensed property assessor.  The process involved generally includes looking at comparable homes in the area, which are properties with similar square footage, condition and year in the same neighborhood.  However, if the expense of a formal assessment is cost prohibitive, you can also obtain a comparative market analysis from a realtor.  A comparative market analysis (CMA) is an estimate based on recently sold, similar properties in the immediate area.  If you don’t want to pay a professional, you can also do your own research on homes through Zillow or Redfin. 

• Consider the financing. 

Your buyout offer may require a refinance of the mortgage.  It is often helpful to talk to a lender and find out the rates and cost of the refinance before approaching your ex-spouse with a buyout offer.  This way you have your “ducks in a row” before beginning a negotiation process. 

• Don’t forget the paperwork. 

Property is transferred through paperwork called a deed.  A commonly used document is a quitclaim deed.  A quitclaim deed transfers whatever interest the grantor has to the other person.  This means that if there are liens or other encumbrances on the property, then those will also be transferred in the quitclaim deed.  This deed will remove the spouse transferring their interest from the title. 

If you need help with a divorce and in particular if you’d like an advocate in the home buyout process, please contact the Law Office of David Knecht, at 707-451-4502.  We have extensive experience in family law. 

One of the big worries in divorce can be health insurance.  A study from 2012 estimated that roughly 115,000 American women lose private health insurance annually in the months following divorce and that roughly 65,000 of these women become uninsured.  This article will provide information about health insurance during a divorce, but it is important to discuss your options prior to the finalization of the divorce.  Here at the Law Office of David Knecht, at 707-451-4502, we have extensive experience with family law and can help ensure that we advocate for your health insurance needs.  

• Before the divorce is final, parties are prevented from changing health insurance beneficiaries. 

When a California divorce is filed, there are immediate restraining orders which prevent the parties from changing the beneficiaries of their health insurance. (See https://leginfo.legislature.ca.gov/faces/codes_displaySection.xhtml?sectionNum=2040.&lawCode=FAM)

• COBRA option. 

One option for keeping health insurance after the divorce is COBRA.  If your former spouse had insurance through an employer that has at least 20 employees, COBRA lets you stay on that plan for up to 36 months, provided you don’t marry again or enroll in a new plan.  You’ll need to tell the administrator of the health plan within 60 days of your divorce or legal separation that you want to remain on COBRA.  The main potential downside is that it can be expensive because you’ll pay the premiums yourself, without the additional money you are used to from the employer. 

(See https://www.webmd.com/health-insurance/insurance-divorce#:~:text=Also%2C%20in%20order%20to%20get,plan%20of%20your%20ex%2Dspouse.)

• Legal Separation to Stay on Spouse’s Insurance. 

For some employers, legal separation is not a disqualifying event.  If the parties are not looking to have a final divorce and legal separation is sufficient, then staying on your spouse’s health insurance and keeping the employer contribution to the premiums may be an option for you.  This might be a preferred option if deductibles have been met for the year and the parties anticipate further need for medical care. 

• Affordable Care Act Insurance.  

Another option after a divorce is insurance options under the Affordable Care Act.  These options can be accessed here: https://www.coveredca.com/.  

• Individual Health Insurance. 

You can contact an insurance broker to find out what insurance options are available to you as individual health insurance. 

• Medicare. 

If you meet certain criteria (for example, typically if you are 65 and have contributed via your earned income or your spouse or former spouse contributed), then subject to some restrictions you may qualify for Medicare. 

This article is an overview and does not include all the options and/or restrictions that may apply to you.  For personalized help making sure that your health care needs are considered in the divorce process, contact the Law Office of David Knecht, at 707-451-4502.  We have extensive experience in family law.