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Divorce FAQs: What Happens to the Family Home?

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Texas Marital Property Basics

Texas is a community property state. When a couple marries, they form a single community, and most property, assets, and debts acquired during the marriage are considered to be owned by the "community." This property is classified as marital property. Separate property is generally defined as property that was acquired before the marriage or which was acquired by gift or inheritance. Mixed or commingled property is that which has elements of both marital and separate property, such as a retirement account established before marriage but contributed to with marital or community funds.

Common examples of community property include:

  • Bank accounts
  • Credit card accounts
  • Real estate, including vacation homes
  • Retirement accounts & pensions
  • Vehicles

Property is classified according to the Texas Family Code Sections 3.001 – 3.008.

Is the Family Home Separate or Marital Property?

When a couple divorces, one of the most difficult parts of the divorce process is classifying and dividing property. Many people own homes with their spouses, and they may have lived in them for decades. However, this does not always mean that the home is automatically classified as marital or shared property.

When determining how to classify real estate during a divorce, the courts will consider:

  • When the home was purchased
  • What funds were used to buy the home
  • Whether marital or community funds were used to maintain or pay for the home
  • Were there any marital agreements that affect how the house is classified (prenuptial or postnuptial agreements)

Once it is determined whether the house is a community or separate property, you can proceed with the property division process. If the home is considered individual property, it will not be subject to property division. If it is deemed to be marital property, your marital home will be subject to property division.

Options for Dividing the Family Home

Every family is different, and there is no one right answer for dividing the family home during a divorce. Your family's needs and your financial situation will impact how you and your former partner deal with your marital home.

Common solutions include:

  • The home is sold, and the proceeds are divided equally between parties
  • One party buys out the other party's interest in the home
  • The couple continues to co-own the property together until it is a better time to sell
  • One party retains the house in exchange for other asses, ensuring an equitable division of all marital property
  • One party stays in the home with the couple's children until the children are grown, and then the couple sells the house and splits the proceeds

It is most common for a divorcing couple to sell shared real estate, like the family home, and divide the profits between them. Even if you want to keep the family home, buying out the other party's interest in the house can be very expensive and not realistic for many people.

Is It a Good Idea to Co-Own Property with My Ex-Spouse?

There are several reasons why someone may choose to continue owning a property with their former spouse. However, before agreeing to this, you should think about the pros and cons of continuing to own property with someone you are divorcing.

The most common reasons for continuing to co-own property after a divorce are when the housing market is unfavorable for sellers and when the couple wants to keep their kids in their family home as long as possible. Both of these are good reasons to consider continuing co-ownership with your former spouse. However, there are some risks inherent in continuing to co-own property with your ex-spouse.

If you choose to retain shared ownership of a home or other property, you and your former partner must remain in contact with each other. You will also have to work together to maintain the property and ensure that all mortgages and other property-related obligations are taken care of. This can be very difficult for couples going through a high-conflict divorce or struggling to communicate with each other effectively.

Additionally, maintaining a financial connection to your former spouse can have a negative impact on your credit. If you and your ex-spouse have a shared mortgage on the property, it will appear on both of your credit reports. If one person fails to make payments, both of your credit scores can be negatively affected. Similarly, if one party files for bankruptcy, the bank and creditors may seize the property as part of the bankruptcy process.

If you are going through a divorce and need help dealing with the family home, reach out to Hunt Law Firm. We have helped many clients in a similar position, and we are prepared to help you through this challenging process.

Contact us online to schedule an appointment with an experienced lawyer.