Deciding Who Gets the House in Divorce in Colorado
The family home can hold sentimental and monetary value- so what happens to the house in a divorce?
When people come to the decision to end their marriage, one financial area of concern is property division, especially when the family home is on the table. After all, the home is not just a valuable asset but also a sentimental one. The question of “who gets the house in a divorce in Colorado?” is often debated in the division of assets as the family house can provide stability and familiarity while many other aspects of life change. A variety of factors are at play to determine who ends up with the house after divorce and there are different avenues to explore if your goal is to maintain ownership of the family home.
Colorado- An Equitable Distribution State
Colorado follows the principle of equitable distribution for dividing assets and debts in a divorce. This means that marital assets, including the family home, are divided fairly but not necessarily equally. Take note that ‘equitable’ does not always mean ‘equal.’ Instead, the court considers various factors to decide a fair division. However, the ultimate decision lies on the judge’s assessment of what is fair in dividing assets. When a divorce goes to court, the judge has the authority to distribute all assets, including property and debts.
Separate vs. Marital Property
Before determining who gets the house in a divorce, it’s beneficial to understand the different property classifications involved:
- Separate Property: This is property that remains separate through a divorce proceeding and can’t be given to the opposing party. Anything acquired before marriage or through inheritance/gifts to one spouse during the marriage, including items like assets bought with separate funds in the marriage, gifts and personal injury settlements.
- Marital Property: Property acquired during the marriage, regardless if both parties are on the title or not
Typically a house purchased during the marriage using marital funds is generally considered marital property. However, it is not uncommon for one spouse to own a house before marriage which can create problems if it then becomes the marital home. When the appreciation is purely because of market dynamics, both the appreciation and the initial asset continue to be the individual’s separate property. However, if the property’s value increases due to contributions from the marriage, whether they’re financial or through efforts and labor, that added value can be considered marital property.
Factors Considered by the Court
The court will look at many factors when deciding the fate of the family home:
- Each spouse’s contribution to the purchase of the house
- Each spouse’s contribution to the maintenance of the house.
- The intent of the parties. If there was a prenuptial or postnuptial agreement in place, it might predetermine the ownership of the home.
- The custody arrangement if children are involved. While not guaranteed, courts may award the home to the custodial parent for maintaining stability for the children.
- Debts and liabilities of each spouse.
- The financial circumstances of each spouse.
Determining the Fate of The House in Divorce
There are several ways the house can be dealt with in a divorce in Colorado, however it may take external guidance from a Colorado family law attorney experienced with property division in the state of Colorado to determine the best situation for your family and your home:
- One Spouse Buys Out the Other: If one spouse wishes to stay, they can buy out the other’s share of ownership, either through cash or by relinquishing claims to other marital assets like a car, boat, or other property.
- Sell the House: It may be best to list and sell the family home and to have the proceeds split equitably. This does not mean the money will be split down the middle but instead fairly for the financial situation surrounding the property.
- Co-Ownership: While uncommon, some opposing parties elect to keep the property together, usually when children are in the picture. This is not very common and requires additional agreements and collaborative efforts to manage disputes as they arise.
How Do I Keep the House Through a Divorce in Colorado?
If you’re in the midst of a divorce in Colorado and you wish to retain ownership of the marital home, you should consider the following steps:
- Legal Consultation: Seek advice from a specialized family law attorney in Colorado to guide you through property division during your divorce.
- Home Valuation: If both spouses can’t agree on the home’s value, consider hiring a real estate appraiser to determine its fair market value.
- Assess Equity: Calculate the home’s equity by subtracting outstanding mortgage or loans. This knowledge will aid negotiations on house allocation and other asset or debt exchanges.
- Negotiate with Your Spouse: To keep the house, be prepared to offer alternative assets such as retirement accounts, other properties, personal items, or taking on more marital debt.
- Buy Out Your Spouse: If you wish to retain the house, you may need to refinance the mortgage to remove your spouse’s name and secure funds to buy out their equity share.
- Mortgage Consideration: If both names are on the mortgage, remember that lenders consider both parties responsible even if you receive the house in the divorce. Ensure your ability to refinance or assume the mortgage individually.
- Future Expenses: Account for ongoing expenses such as maintenance, taxes, insurance, and mortgage payments after acquiring the house. Ensure your single income can cover these costs.
- Update Deeds and Titles: If granted the house, update the deed to reflect only your name, which may involve filing a quitclaim deed.
Consult with an Experienced Colorado Family Law Attorney
The division of assets in a divorce, particularly assets as significant as a family home, can be a pivotal part of your divorce with long term impacts. It’s essential to work with knowledgeable professionals who understand the nuances of Colorado laws as it pertains to family law and property division.
If you’re going through a divorce or contemplating one and have questions about your property rights, consult with an experienced divorce and family law attorney at Colorado Legal Group. Our seasoned family law attorneys will not only advocate for your best interests every step of the way, but with them by your side you can rest assured we will do everything in our power to ensure your assets are protected. Contact us today to see how we can help!