Possession of the house and other property is always a sticky situation in Arizona divorce proceedings. Even if you agree which one of you will keep the house after divorce, you still must determine the home’s value and how to compensate one spouse for what is often a married couple’s largest asset. Whether you need legal advice about who can keep the house after your divorce, Arizona community property laws, or other divorce-related issues, a divorce lawyer at Provident Law® can assist you.
Community Property and Your Home
Arizona community property laws state that all assets and debts acquired by either spouse during a marriage belong to both spouses. If spouses cannot agree otherwise, the court must divide the property, including the marital home, equitably between them under A.R.S. 25-318. While an equitable division of property is not always equal, depending on the circumstances, a roughly equal division of property is typical.
In an Arizona divorce, you divide only community property, not separate property or property that one spouse acquired before the marriage or solely through gift or inheritance. However, separate property can change to community property if the owner spouse does not keep it separate from all community property.
For example, if one spouse owns a home before the parties’ marriage, it is separate property. However, if both spouses contribute to the mortgage payments, insurance premiums, property taxes, and general house-related expenses, the house may become partially or fully community property.
Dividing the Marital Home
Except in cases where the home remains separate property of one spouse, the marital home is community property for equitable property division in the divorce. The home is community property regardless of whether it is held solely in one spouse’s name, as tenants in common, or jointly.
In most cases, the marital home is divided equally between the parties. At that point, the parties must determine how to adequately compensate each of them for their respective shares of the home. The simplest solution may be to sell the house and divide the sale proceeds between the spouses. The necessary expenses of the sale, such as the outstanding balance on the mortgage loan and realtor fees, come equally out of each spouse’s share of the proceeds.
However, one spouse may wish to keep the family home, especially if minor children are involved. In that case, the spouse who wishes to keep the home must compensate or buy out the other spouse’s share of the property.
The spouse keeping the home can pay the other spouse their portion of the equity in the home in cash or by giving that spouse other assets whose value is equivalent to their equity share. Alternatively, a spouse may buy out the other spouse’s share by refinancing the home and paying out half the equity to the other spouse from the proceeds of the new mortgage loan.
In all cases, if both spouses’ names are on the deed to the home, the spouse who is keeping the home should refinance the home solely in their name to remove the other spouse’s name from the mortgage.
The Effects of Prenuptial and Postnuptial Agreements
Prenuptial agreements are agreements that an engaged couple signs before marriage. Postnuptial agreements are signed after marriage. However, whether an agreement is a prenuptial or postnuptial agreement, it is legally valid and binding if it meets certain criteria. For instance, a prenuptial agreement must be voluntary, including full disclosure of assets and liabilities for each spouse, and must not be unconscionable when the parties sign it.
Contact Us Today for Legal Help with Your Divorce Case
A divorce attorney in Arizona can assist you with your legal needs regarding property division and other property-related issues throughout and even after your divorce. The attorneys at Provident Law® have a long history of handling all your most important legal matters, including divorce. We will advise you about your rights and responsibilities concerning property division in your Arizona divorce. Call us today at (480) 388-3343 or contact us online to see what we can do for you.