You and your spouse worked hard to get where you are today in your own careers. All the properties you own together are a testament to that success. When the ties that bind matrimonial union face the prospect of dissolution, the matter of disentangling shared lives demands a thorough comprehension of Texas’s family laws.
Understanding the Lone Star State’s approach to property division is crucial for those standing at the crossroads of divorce with the added intricacies of multiple properties in the balance. Whether you should sell the properties you own depends on several factors.
The type of property
Marital property refers to all the properties you and your spouse obtained during the marriage, regardless of whose name is on the title. Unlike most states that follow the equitable property division principle, community property is the standard for property division in Texas. Therefore, courts will favor an even split. Fortunately, your separate property will not be subject to the equal distribution. You may not have to sell it or split the proceeds with your soon-to-be ex-spouse.
Alternatives to selling
Even though the court aims for a equal division, it does not necessarily mean you will both receive exactly the same amount. Factors such as each spouse’s earning capacity, fault in the breakup of the marriage, custody of children, and the value of separate property are considered. If selling the properties and dividing the proceeds is the most equitable solution, then that is the path the court may order. However, there are alternative scenarios to consider:
- Buyout: One spouse may have the option to buy out the other’s share of the property, allowing them to keep the real estate.
- Offsetting Assets: Instead of selling a property, one spouse might retain the real estate while the other receives assets of comparable value.
- Co-ownership: Though not common, ex-spouses might agree to maintain joint ownership of a property post-divorce, which could be the case with income-generating properties.
The decision to sell or keep properties in a divorce is not always a legal one because the value of real estate tends to fluctuate.
Selling real estate in a slump market might not be the best financial move. Similarly, retaining property that is too expensive to maintain could also put you at an economic disadvantage after a divorce.
Before deciding to sell or keep a property, you must consider all the relevant factors. Otherwise, you could be fighting for a future liability or selling real estate that could generate considerable income.