Legal Question in Family Law in California
Division of increased value in Seperate Property
Prior to marriage my wife purchased a home. Upon purchase we moved into that home together and shared in all expenses. During this time we were married. Approximately 21 months after we both moved in (14 months after the marriage) she sold the home and we purchased a new home using almost exclusively the assets from the increased value in the 1st home. We are now getting a divorce. I have never lived in the new home we purchased togethor, and have not contributed to any expenses. She is claiming that I am responsible for half of the expenses (subtracting FMV for 'rent'), but that upon sale of the home she first be reimbursed for 100% of 'her seperate property contribution' from the sale of the 1st home. Basically, I'm looking at having to indefinately pay nearly $1000/month (25% of my takehome), for a property that I will likely never see any value from. I should point out that my wife makes approximately 3 times what I make.
Q: Am I entitled 'credit' for any of the increased value in the first home?
Q: What are my best options for minimizing my expenses?
1 Answer from Attorneys
Re: Division of increased value in Seperate Property
1st home: The community has a small interest in that home tied to the amount of community funds used to pay down the principle balance on the mortgage. This is usually minimal in a short period of time, so figure the net sale proceeds to be her separate property.
2nd home: She is entitled to return of the separate property funds used to purchase or improve the property, assuming it has that much equity. Assuming your name is on title, any equity left after her reimbursement would be divided equally.
Debt service. You do not have to pay 1/2 or any other portion. She might be able to get a credit for what she pays against the house; on the other hand, she can afford it.
My advice: File motion for spousal support or, in the alternative, she makes the payments on the house in full without reimbursement. You might find that spousal support will exceed your 1/2 of the house payments. You might also seek to have the property sold at this time rather than waiting for trial, if neither of you can afford the payments.
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