For most divorcing couples, the family home will be the most valuable asset that needs to be dealt with. Not surprisingly, it is also one of the most common sources of property division disputes. This is not only because of the house's value, but because of what it represents. There may be many happy memories stored in those walls.
When determining what to do with the family home, it can be important to consider all options and to understand how property division works in Colorado.
Colorado Is An Equitable Distribution State
As an equitable distribution state, marital assets are to be divided in a manner that is fair and equitable. That could mean a 50-50 split, but it does not necessarily have to be.
It is also worth keeping in mind that only marital assets are subject to property division in a divorce. Typically, a family home will be a marital asset. However, in some cases, the home may have been purchased prior to the marriage, meaning that a portion of the home's value may be considered separate property and that portion may not subject to division. This could impact how the home is divided.
Potential Outcomes For The Family Home
In most cases, there are two potential outcomes: either one spouse will keep the home or the home will be sold. Other outcomes could possibly be reached through an agreement, such as a nesting arrangement in which children stay in the family home and parents rotate in and out, but these are relatively rare.
When one spouse keeps the family house, the other may be compensated by receiving a larger amount of other marital property. For example, the spouse who does not keep the house may get more money from a shared savings account.
When the family house is sold, the proceeds from the sale may be divided between the spouses. As mentioned, since Colorado is an equitable division state, the proceeds may not be divided 50-50 between spouses. One spouse may get a larger percentage of the proceeds than the other, if that is what is determined to be fair.