When it comes to divorce, California is a community property state. This means that for purposes of property division, any assets acquired by either spouse during marriage are jointly owned by the two. Thus, in the event of divorce, commonly owned property is divided equally between the separating spouses. However, many question what happens with the spousal home in the event of divorce if the separating couple wants to keep the property.
An expert in property division recently answered the question of what to do with commonly owned property between two spouses, now divorcing. Specifically, because of California’s law, a married couple or domestic partners can hold title to a home as community property. However, in the event of divorce, it is no longer possible to hold a community property title together, and as such, the title must be changed.
In some cases, the property agreement actually specifies how such real property is to be owned if divorce occurs. However, if the agreement does not speak to later division, it may be up to the spouses to decide what to do with the title. Spouses can agree prior to divorce on how to handle the home in event of separation.
In California, individuals can own property as tenants in common or as joint tenants. If a separating couple chooses to own property as tenants in common, they can individually dispose of the property at their choosing. Thus, someone could own the property in common with someone else in the future. Tenants in common can also own unequal portions of the property. As joint tenants, each possesses equal interests. When the first person dies, the individual who remains inherits the entire property.
Many experts recommend owning the property as tenants in common in the event of divorce simply because it is a less intimate form of ownership. However, consulting a family law attorney prior to making such a decision is wise. Depending on the details of your other assets, the relationship between you and your spouse and the law, either a tenancy in common or joint tenancy could serve best if separation occurs.
Source: The Sacramento Bee, “How to own title to co-owned real property after divorce,” Claudia Buck, Aug. 30, 2012