What Happens to a Pre-Marital Home in Divorce? It’s More Complicated Than You Think

Divorce often involves difficult decisions about the marital home. When one spouse purchased the home before marriage, determining who keeps it can become complicated. Understanding how North Carolina treats pre-marital homes, and speaking with a Charlotte divorce attorney, can help you protect your interests and work toward a fair outcome.

What is separate property?

Separate property is property acquired before your marriage. Or, alternatively, something that was given to one spouse, and only that spouse. Some examples of separate property in the context of a marriage include:

• A furniture set that was acquired before you and your spouse were officially married.
• A car that was given to one spouse, instead of being given to both spouses.
• A bank account that was started before the marriage and never turned into a joint account.
• A house that was purchased by one spouse, for their own usage, prior to the marriage.

In North Carolina, separate property is kept by the spouse who owns it. It’s not typically divided, although marital contributions may give rise to a marital claim to part of its value.

What is marital property?

Marital property is property that was acquired during the marriage and prior to the date of separation. A few examples include:

• A bank account that was turned into a joint account right after the marriage began.
• A collection of art that was purchased during the marriage.
• A car that was purchased during the marriage.
• A computer that was purchased during the marriage.
• A beach house acquired during the marriage bearing both spouses’ names.

If your home is considered marital property, it can be divided during the divorce process. This means that one spouse could get it, even if they weren’t the one who purchased it.

How can a pre-marital home be considered marital property?

A pre-marital home may remain separate, but certain circumstances can give rise to a marital interest in its equity or appreciation. Some of these conditions are as follows:

• Both spouses are on the title of the home, even if one spouse purchased it prior to the marriage.
• The home’s value increased due to both spouses’ efforts or contributions.
• Funds from a marital joint account were used to pay the mortgage or perform repairs, among other things.

None of the conditions listed above guarantees that a pre-marital home will be considered marital property in the event of a divorce. But, if they are present, there is a chance a pre-marital home will be considered marital property.

Can equity gained during the marriage be shared?

Yes. A premarital home usually remains separate, but marital contributions can create a marital claim to part of the equity and appreciation. For example, if you purchase a home for $150,000 before getting married and then, twenty years later, this home is worth $400,000 due to the other spouse paying for remodels, the marital portion may include the increase in value/equity tied to marital contributions, while the premarital portion may remain separate.

Some of the ways that equity gained during the marriage can be shared are as follows:

• The spouse who did not purchase the house contributes to the house’s upkeep and maintenance with their own funds.
• Marital funds in a joint account are used to pay the home’s mortgage or upkeep or maintenance.

If a home is considered a marital home, it can be divided during a divorce. Courts divide marital property; separate property is not divided, though a spouse may have a claim to a marital portion of equity/appreciation in a premarital home.

What are common mistakes people make that turn a pre-marital home into a marital home?

A number of mistakes can lead to a pre-marital home turning into a marital home, including:

• Adding a spouse to title can create a strong presumption the property (or a portion) is marital, but outcomes depend on how/when title changed, source of funds/consideration, and evidence of intent.
• Using funds from a joint account to make repairs on your home, remodel it, or pay the mortgage, without documenting where these funds came from and that they were your funds for your contributions.
• Assuming a premarital agreement isn’t necessary. It isn’t always fun to think about, but a prenuptial agreement can prevent your pre-marital home from being given to the other spouse.
• Not documenting your contributions to the home. Without proper documentation, your spouse could claim that they paid the mortgage or performed remodels, which could turn your home into a marital asset.

Every single one of the above can put your home in jeopardy. To protect yourself right now, you may want to consider the following:

• Collect financial documentation that proves your pre-marital home belongs to you. This can be the home’s purchase record, title, mortgage, and statements proving your sole contribution to the pre-marital home.
• Do not add your spouse’s name to the title or any other relevant documentation without speaking to a divorce attorney.

If you are getting divorced, working with an experienced Charlotte divorce attorney can help. At Epperson Law Group, PLLC, we are ready to help you obtain the best possible divorce outcome. Contact us today.