You and your spouse bought a house in California during marriage (post 1975). You used your salaries earned during marriage to make the down payment and pay the mortgage and/or any equity payments.
Is your house in California a community property asset?
If the Golden State is your domicile (your permanent “home”), no separate property interest was specified in the Deed, and you/your spouse never expressly agreed in a signed writing that the house was transmuted (changed) from community to separate property (e.g. prenuptial agreement, Inter Spousal Transfer Deed, Living Trust, Transmutation Agreement), the house is a community property asset under California community property law.
Family Code section 760 states:
Except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in this state is community property.
Family Code section 2581 provides:
For the purpose of division of property on dissolution of marriage or legal separation of the parties, property acquired by the parties during marriage in joint form, including property held in tenancy in common, joint tenancy, or tenancy by the entirety, or as community property, is presumed to be community property. Fam.C. § 2581
California Family Code section 852(a) states:
(a) A transmutation of real or personal property is not valid unless made in writing by an express declaration that is made, joined in, consented to, or accepted by the spouse whose interest in the property is adversely affected.
Do you need to know whether your house is a community property before going to court in California?
If you’re going to court to ask a judge to decide how your assets and debts should be divided, yes, you need to know whether your house in California. “The judge’s characterization of the parties’ property as community property or separate property determines how the property will be divided between the spouses.”
Do you need to know whether your house is a community property before negotiating a divorce settlement?
No. If you negotiate a settlement agreement you don’t need to determine whether the house is a community property asset. Nevertheless, I recommend knowing the characterization and using it when making and fielding settlement offers or deciding to settle or go to court.
If you know the house is your spouse’s separate property before the settlement conference you can still ask your spouse to treat it like community property and give you one-half the net equity. If your spouse refuses and is ready to go to court, knowing the asset is separate property and should be awarded solely to your spouse, you can settle the case instead of going to court and losing.
Which facts will help you determine if your house is community property?
- The date you/your spouse acquired the house from a third party
- Your date of marriage
- Your date or separation
- The existence of any signed agreements expressly declaring that you/your spouse transmuted (changed) the character of your house from separate property to community or vice versa
- Property deeds
- Estate planning and probate documents
- Signed written agreements pertaining to the house
- Bank records
- Escrow property sales files
- Mortgage applications and records
- Probate Court records
- Tax returns
- Gift receipts
- Correspondence (e.g. letters, emails) about the characterization or ownership
Which documents can you use to determine if your house is community property?