When you’re staring down the possibility of divorce, the fate of your family home is likely one of your biggest concerns. Is it automatically considered a marital asset and subject to division? What if the deed is only under your name?
It all depends on the unique facts of your situation. Understanding how the law works can help you plan your next steps with clarity and make informed decisions as you navigate the divorce process.
The law in Michigan
If the family residence was acquired during the marriage, it’s treated as marital property regardless of whose name is on the title. This means that it will be divided equitably as any other marital asset.
On the other hand, a family home owned by one spouse before the marriage or received as an inheritance or gift can remain that spouse’s separate property only if it was kept entirely separate. This means no marital funds were used for mortgage payments, taxes or renovations, and no joint effort increased the property’s value.
If marital funds were used to pay the mortgage or improve the home, or if the non-owner spouse contributed significantly to increasing the property’s value, a portion of its equity may be subject to division.
What options do you have?
Once the status of the family home is categorized, you and your spouse can agree on these practical options:
- One spouse keeps the house and buys out the other’s share of the equity (by cash or offsetting other marital assets)
- Sell the home and equitably divide the proceeds.
If you can’t agree on the way forward, the court will decide based on what’s fair under the specific circumstances of your marriage. For instance, the court may allow one parent to remain in the home temporarily to provide stability for the children, with a sale planned later on.
Having proper legal guidance early in the divorce process is key to ensuring a fair outcome when splitting such contentious assets, whether through negotiations or court proceedings.