How do we divide our property?
In a Texas divorce, if the parties cannot agree to how their property is divided, the court is required to divide the property in a “just and right” manner. There are many incentives for couples to divide their marital estate amicably, such as: lower attorney fees, quicker divorce process, etc.
Under Texas law, property related to marriage can be characterized as either community property or separate property. Community property is all property owned after the marriage and all property owned before the divorce case is final. Whereas, separate property is all property owned by a spouse before marriage or property received during the marriage via gift or inheritance (a Will).
Although the court recommends dividing marital property amicably, sometimes it is difficult because of various presumptions related to community property and requirements related to separate property.
Example 1: In the year 2000, John marries Barbara. In the year 2010, John inherits $100,000 from his grandfather’s estate and uses the money to buy a house. If John and Barbara file for a divorce, the Texas court will make the presumption that the house belongs to both John and Barbara, since all property owned at the time of the divorce is presumed to be community property.
Example 2: In the year 2000, Barbara buys a house for $100,000. She makes a $20,000 initial deposit and obtains a loan for $80,000. A few months later, Barbara marries John. If Barbara and John file for a divorce TEN (10) years later, the Texas court will assume that Barbara has used the couple’s community property to pay off the mortgage. Unless Barbara can establish by clear and convincing evidence that she used only her separate property to pay off the house, Barbara cannot claim the house as her sole and separate property.
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