Who Gets the House in a Los Angeles Divorce

Community property laws in California generally mean that assets acquired during a marriage are divided equally between the spouses if they divorce.

Often, the family home is one of the major assets to consider during a Los Angeles divorce. The judge will need to either approve the agreement made between spouses or decide what happens to the house after a trial.

There is no single answer to the question of “Who gets the house?” The outcome depends greatly on the circumstances, parental/spousal priorities, the marketability of the asset, and the financial ability of a spouse to maintain it.

Let’s consider this question in more detail.

During a divorce, a clear distinction must be made between marital property (or the “community estate”) and separate property.

When determining this, the timing of the property acquisition is very important:

• Marital property includes any property (including real estate, personal property, investments, etc.) that the couple purchased together or obtained during their marriage.
• Separate property includes anything pre-owned by either spouse before the marriage, as well as gifts/inheritances, personal injury settlement proceeds, and a few other exceptions.

Often, the house is purchased during the marriage and is, therefore, considered community property, but not always.

Divorcing couples often disagree on who gets what in a divorce. If the house is disputed, creative or negotiated solutions may be required, as a house cannot simply be split down the middle like a savings account could be.

Full financial disclosure by both spouses is required before property division agreements can be finalized or court cases heard.

An experienced divorce attorney can help you identify the documents required to prove ownership of items, income, investments, etc. You may need to prove that an item should be considered separate property and not subject to marital property division.

What happens to the house during a Los Angeles divorce is often impacted by whether there are children from the marriage.

One common misconception in California is that the wife gets the house in a divorce. This is not true but it may turn out that way if children from the marriage live primarily with their mother.

To determine who gets the house in an L.A. divorce with children, we first need to consider:

• Who owns the home?
  • If the home is the separate property of either spouse, ownership will not usually change after divorce (though the increase in value of the home may need to be shared equally).
  • If one spouse owned the house before marriage (separate property) but used community funds (income earned during the marriage) to pay down the mortgage, the community acquires a pro-tanto interest in the property.
  • If the home is community property, as in most cases, other factors will need to be considered.
• Is there a marriage agreement in place?
  • If a legally enforceable prenuptial or postnuptial agreement is in place, this can override standard property division laws.

In a divorce with children, there are several options for “dividing” the home:

• One spouse can be awarded the property while the other receives assets equal to the home’s value.
• One spouse can buy out the other’s interest in the home.
• The home can be listed for sale.
• A deferred sale or “Duke Order” may be agreed or ordered to protect the children’s status quo (more about this below).

Often, during divorce cases in Los Angeles, who gets the house can be a two-stage process: who stays there while the divorce is being processed, and who owns it after the judgment.

Judges in California have a duty to act in the children’s best interests. If those interests include remaining in the family home with one of the parents, an arrangement that allows this will be prioritized.

Sometimes, parents agree on the best way forward to protect the children’s interests, and the judge simply needs to approve the agreement. The judge’s signature turns the agreement into a court order, provided the parties agreed voluntarily and free of fraud, duress, or coercion.

Alternatively, the divorce case may proceed to trial, and the family court judge will need to decide who keeps the family home. The judge’s decision will consider the following types of factors:

• The length of time the children have lived in the home.
• The children’s placements or grades in school.
• Whether emotional detriment to the children could be associated with a change of residence.
• The feasibility of the parent proposing to remain in the home to maintain mortgage, property tax, and insurance payments, etc.
• Whether the parent will be able to maintain the home in a condition comparable to that at the time of trial.

If the couple does not have children and the house is part of the community estate, selling the house and splitting the proceeds is often the simplest solution, even if both parties want to keep the house.

A spouse/parent who remains in the home is usually responsible for:

• Mortgage payments (which usually necessitate refinancing within a set deadline),
• Property taxes,
• Homeowner’s insurance, and
• Reasonable maintenance.

Refinancing is often the biggest hurdle. A judge can award the house to one spouse, but they cannot force a bank to remove the other spouse from the loan. If the staying spouse can’t qualify for a refinance of the mortgage, the house usually must be sold.

Note that selling the home while still married, as opposed to after the divorce is final, can have massive tax implications. Specifically, selling while married may allow for a $500,000 capital gains exclusion, whereas selling as a single person after divorce may limit that exclusion to $250,000. This should be discussed with a qualified Los Angeles divorce lawyer or accountant.

Besides this, any divorce agreement should be drafted professionally with a divorce lawyer’s input to ensure legal enforceability.

In some Los Angeles divorces, “Duke Orders” can allow one of the parties in a divorce (often the primary custodial parent living with the children) to reside in the home until a certain date, after which time the property must be sold and the proceeds split between the divorced couple.

Agreements must, again, be drafted professionally and the precise terms of sale set out to avoid legal ambiguity at the time of sale.

If spouses do not agree, one parent can request a court order for the deferred sale of the home, in the interests of minimizing the adverse effects of the divorce on a minor child’s well-being (often, children with special needs or for short-term arrangements).

The family attorneys at The Sands Law Group APLC can help with property division or any other aspect of divorce in Los Angeles. Contact us online or call 213-788-4412 today for a free case evaluation.