Will I Lose the House in My Divorce?

The House is Titled in My Spouse’s Name. Will I Lose it When We Divorce?

It’s common knowledge that when someone purchases a home, they go to the title company, sign documents, and the new homeowners receive a title that shows that they are the rightful owners to the home. 

Some married couples end up with a situation where only one spouse is on the title to the home causing one spouse to be confident that the house will be awarded to him or her during divorce proceedings.  Or the other spouse is fearful that he or she will be left high and dry not receiving any part of the home’s equity, let alone, be awarded the opportunity to live in the home after the divorce.

What to Discuss with Your Divorce Attorney

Your attorney will first ask you what your needs are on a temporary basis and what your ultimate wishes are regarding the home when the divorce is finalized.  For example, you may want to stay living in the home for a few months until the end of the children’s school year or while you find another home.

Then, the next step your attorney will determine if the home is considered marital property.

And finally, your divorce attorney will advise you what your options are on a temporary basis and in the final Judgment of Divorce.

What is Marital Property in Michigan?

Michigan law provides that all marital assets and debts must be divided equitably.   This begs the question: is the house a marital asset if it is titled in only one party’s name?   One of the first things that the judge will consider when dividing assets, such as the marital home, is determining if the asset is considered a marital asset or a separate asset.  Marital property or assets are generally all assets that were accumulated during the marriage.  This means that if your home was purchased during the marriage, the judge may rule that it is marital property; regardless of whose name is on the title.  If the home was purchased prior to the marriage, but both of you made the mortgage payments during the marriage or contributed to the home’s value, the increase in the home’s value will likely be considered to be  marital property. 

After a determination that the home is marital property, the next step will be a determination how to best divide this asset.

Who Gets the House?

While the divorce is pending, the judge may take into consideration whether minor children are involved and who is caring for the children most of the time.  One of the goals during the divorce proceedings is to provide a stable home environment for the children.  The judge also will consider who is able to pay the mortgage payments, if either party is able to live somewhere else, and if it is possible for both parties to stay living in the home while the divorce proceedings are ongoing.

While the divorce is pending, you and your spouse will need to come to an agreement who ultimately is awarded the house or if you want it to be sold and have the proceeds divided.  If you are not able to reach an agreement with the help of your family law attorney or by attending mediation or settlement negotiations, the judge will decide at a trial who is awarded the house or if it should be sold.

When you negotiate who gets the house or when you prepare your case to present to the judge, you should consider whether you want to stay in the house.  Can you afford the mortgage payment? Do you and your children have good memories about this home?  Is keeping the house a good investment? 

When you have determined that you want to stay in the house, there are additional considerations and decisions you will need to make.  You will have to pay your spouse his or her share of the equity in the home.  The equity in the home is the value of the home minus the outstanding mortgages and liens.  A common payment method is to refinance the home to obtain a new and larger mortgage allowing you to pay off your spouse’s share of equity.  Alternatively, your spouse may receive other assets, such as retirement funds to offset the equity in the home awarded to you in the home.

In our decades of family law practice, our clients sometimes arrive with a false sense of confidence or fear regarding their rights to certain assets.  A consultation with our family law attorneys will allow for a realistic preparation prior to the divorce and a solid representation while the divorce is pending. Call us at 616-285-0808 to start a conversation with solid advice from our experienced Grand Rapids family law attorneys.