Who gets the house in divorce if one party owned it before marriage?

Arizona law requires a community property approach in divorce cases.  In general, assets and debts acquired by either party during the marriage will be considered community property and will be “equitably” divided by the Court if the parties proceed to trial. Assets and debts acquired prior to the marriage, if kept separate, can typically be expected to be characterized as separate property, not subject to equitable division.  In many divorce proceedings, the two most significant community assets include the marital home (or homes) and retirement accounts.

In situations where the marital residence was purchased during the marriage and deeded jointly to the parties, the home is considered community property and will generally be disposed of in one of three ways. The available options essentially include:

(1) Wife buys out Husband’s interest in the home;

(2) Husband buys out Wife’s interest in the home; or

(3) the home is sold and the proceeds divided between the parties.

In situations where one party owned a home prior to the marriage, or a home was purchased during the marriage but deeded to one party as their separate property, the analysis is markedly different.

When one spouse brings a residence with them into the marriage, Arizona law requires the application of a very specific formula to determine what interest, if any, the non-owner spouse can claim. Increases in the value of the property, or decreases in the amount owed on the property, under certain circumstances can give one spouse a claim against the equity in the other spouse’s separate property.

Though each divorce is unique, these situations often call for current and historic appraisals, in addition to detailed information regarding financing of the home since its initial purchase.  In many cases, past and present trends in interest rates and the overall real estate market must also be accounted for.

Because the marital residence is often one of the most significant assets in a marriage, having an attorney who is experienced in handling equitable claims against separate premarital real estate is a tremendous advantage. Given the stakes, it is advisable to involve an attorney who is comfortable navigating Arizona divorce cases through this complicated process based on prior experience. You are in essence, betting the house.  It is important not to make that process a gamble.

For more information, contact attorney Michael Girgenti, today.