How would a divorce affect property?
Don't clear the house until after a divorce.
With the divorce, all legal consequences should be clarified. The house is of central importance, which is easily overlooked. If you don't deal with it until after the divorce, it may be too late. Divorce with a house has its own special features. First of all, a distinction must be made as to whether both spouses or only one person is the owner.
The 10 peculiarities of divorce with sole ownership.
- If a spouse is the sole owner, it stays that way even in the event of a divorce.
- The owner stays in the house even after the divorce.
- It is possible that the non-owner and the children can use the house, even after the divorce.
- The sole owner has to repay the house loan alone, even if the spouses are jointly debtors in the loan agreement.
- In the event of divorce, the property of a spouse leads to profit compensation if it was bought, built or expanded in the marriage. (Gain compensation is a compensation payment for the increase in wealth in the marriage.)
- The house owned by one spouse can lead to profit compensation if it was bought before the marriage, but expanded or modernized afterwards.
- In the event of a divorce, an inherited house is not included in the profit sharing scheme. If a spouse inherited the house and later expanded or modernized it, only the increase in value is included in the gain adjustment. In principle, an inheritance obtained in marriage cannot be compensated.
- The sole owner can only sell his house before the divorce with the consent of the other spouse.
- If the equalization of profits has not yet been clarified, the sole owner also needs the consent of the divorced spouse to sell the house after divorce.
- This applies for a maximum of 3 years after the divorce has become final.
- A prenuptial agreement upon marriage can help avoid house arguments in the event of divorce.
The 12 peculiarities of divorce with a common house.
- If both spouses are entered in the land register, they jointly own the house.
- Divorce law does not require an agreement on the house. You will also get divorced if you keep the house together.
- Divorce law does not have a division of the house in the event of divorce. If there is no agreement, all that remains is a division auction.
- Nothing happens to the house by itself before, during or after a divorce.
- It is not advisable to keep the house together after a divorce.
- Those who live in the house generally have a housing advantage and thus a higher income. This can affect child and spouse maintenance.
- Anyone who does not live in the house and neither owes nor receives maintenance can claim compensation for their co-ownership.
- One spouse can have the house overwritten before or in the event of a divorce and pay off the other. This usually represents gain that can affect the gain compensation.
- Paying off for an overwriting of the house can trigger income tax.
- It usually makes sense to have the value of the house appraised. A proper appraisal is even better.
- The house loan for a joint house must be repaid in half by both spouses.
- A divorce without an agreement on the house, the house loan, the maintenance and the profit compensation does not make sense.
The details of the wholly owned house.
It makes a difference who owns the house.
Whoever is in the land register is the owner.
Sometimes married couples transfer home ownership to each other. Sometimes both finance the house purchase, but in fact only one is entered in the land register as the owner. Occasionally the house is built together on a partner's property and the marriage takes place later. In the event of a divorce, this first leads to the question of who actually owns the house, who is the owner of the house. This results solely from the land register for the property, namely from the property department. If only one name is entered, this spouse is the sole owner.
Who will stay in the house until the divorce?
If spouses live separately from each other or one of them wants to live separately, regardless of divorce proceedings, he can demand that the other let him or part of the marital home for his sole use for the duration of the separated life. This is regulated in § 1361b BGB. The provision is also the legal basis for imposing obligations on the other spouse to provide lease and conduct. The regulation also stipulates that 6 months after a spouse voluntarily moves out, the transfer of the house to the other is irrefutably presumed and the extent to which compensation for use can be demanded.
The profit compensation in the event of divorce and sole ownership of the house.
Spouses without a marriage contract live in the community of gains. When the marriage ends, the gain is compensated, which only leads to a monetary claim. No home ownership will be transferred. The initial assets in the event of marriage plus inherited assets are compared with the final assets on the day the application for divorce was served. If the fortune has increased, there is a gain. The difference is the gain of each spouse. The different gains made by the spouses are then to be compensated in money. As part of this determination of the initial and final assets, existing properties are to be valued on the two reference dates (marriage and application for divorce).
After the marriage, the husband was entered in the land register of the property as the sole owner. The woman's petition for divorce is served on him. The property has been paid off and is worth € 250,000.00. The couple have not acquired any other property. Then the woman against the man is entitled to payment of € 125,000 in profit compensation.
After the marriage, the wife was entered in the land register of the property as the sole owner. Her husband's petition for divorce is served on her. The property has been paid off and is worth € 250,000.00. The couple have not acquired any other property. The wife inherited € 50,000.00 in the marriage. The gain for the woman is thus € 200,000.00, that for the man is € 0.00. Then the man against the woman is entitled to payment of € 100,000 in profit compensation.
The equalization of assets in the event of divorce according to GDR law in addition to the equalization of gains for marriages that were concluded before October 3rd, 1990.
Spouses lived in a so-called community of acquisitions in the GDR. Basically, they became joint owners of all things acquired during the marriage. However, real estate bought, inherited or given by a spouse before the marriage remained in his sole ownership. If the spouses built, expanded or modernized a house on such a property, the spouse registered in the land register remained the sole owner of the house. For such marriages, however, the initial assets should be based on October 3rd, 1990 and not on the date of the marriage. Because the BGB did not come into force in the area of the former GDR until October 3rd, 1990. That in turn would prevent an equalization of assets. For this reason, the provisions of the GDR Family Code (Sections 39, 40 FGB) on property equalization between spouses for marriages from the GDR are still applicable today if one spouse was already the sole owner of the property in the GDR.
The Effect of a Prenuptial Agreement on Divorce.
A marriage contract is a contract with which spouses regulate their property affairs for the duration of the marriage and beyond when they get married. This is usually used to clarify who owns what in marriage and who can ask for something from whom in the event of a divorce. You can set valuation rules and remove individual assets such as real estate from the profit sharing. A prenuptial agreement helps avoid arguments. The deal is always worth considering in connection with a property.
The details of the common house after divorce.
Who owns the common house after divorce? Who will get it? Who will stay in it? What is happening to it? Is there a house division by the family court? All of these questions are basically aimed at one problem. The community of co-owners does not end with the divorce proceedings. You can get divorced as a married couple, but you will not be “divorced” as a co-owner of your house. Divorce law has no such connection. If you remain the owner of the property as a divorced couple, you must continue to maintain and finance the property together. That doesn't make sense and rarely works. So you need to take action and look for a solution. You have the following options with regard to the division of the house:
- You can take it over and pay off the other or vice versa,
- You can sell it together
- You can transfer it to a common child,
- You could split it up into condos and distribute them among each other (very rare case),
- if you cannot come to an agreement, the division auction remains.
In the event of divorce, transfer the house to one spouse and pay off the other.
Often the spouses agree to transfer the house to one of them even before the divorce. The house transfer is not in itself legally difficult. The transferor and the transferee must agree that the joint ownership of the property will pass. You must have this declaration certified by a notary when you are present at the same time. The transferee must pay the agreed price to the transferor. The notary then applies for the change of ownership to be entered in the land register of the land registry office responsible for the property. When the person taking over is entered in the land register, the house is transferred to him. Before doing this, however, you need to clarify maintenance and profit compensation. Otherwise there is a risk of financial disadvantages later. Because living in your own house leads in the majority of all cases to a higher income and thus to a higher maintenance obligation. Taking over the house before the end of the marriage also represents an increase in assets. The increase in assets in one spouse can lead to the other spouse being entitled to equalization. So you shouldn't just transfer the property to one of the two without clarifying and settling all other consequences of the divorce in this context. Furthermore, it must be clarified that the transferring spouse is completely released from liability for the house loan by the bank. No notarial contract should be notarized without the bank's prior statement.
Selling a home during or after divorce.
If you want to sell the joint property because of the divorce you should pay attention to the following:
- Before the divorce, agree on how long each spouse will be in the house. Arrange specific evacuation dates.
- Agree on a minimum sale price.
- Clarify with the bank whether a prepayment penalty is to be paid for the repayment of the home loan.
- Clarify how the sales proceeds are distributed and paid out among them.
- Clarify how selling your home affects divorce gain compensation.
- Find out if you have to pay taxes on selling your home.
- Have an energy performance certificate drawn up for the property.
- Contact a local agent. Clarify the achievable price, the other required documents and the sales period with this brokerage office. The broker usually also checks the solvency of potential buyers for you. That's very helpful.
- Carefully list all the defects in the house, do not hide any damage to the house.
- Clarify what will be sold with the house. Think of the fitted kitchen and the like.
The division auction or how you can still force the house to sell after a divorce.
If you cannot come to an agreement with your spouse about who will get the common house or whether it will be sold, you can only apply for a division auction. Because it is not possible to force the house to sell in any other way. The property is then publicly auctioned by the enforcement court. Anyone who is a co-owner can submit this application. In principle, the consent of the other is not required. There is an exception if you are not yet divorced, the profit sharing has not yet been clarified and the house is almost all of your assets. Then you can only have a division auction carried out after the divorce without the consent of the other spouse. If you live in the property regime of the community of property, the application for a division auction can only be made after the divorce has become final or with the consent of the other. Selling to a third party is always preferable to a division auction.
Should you keep the common house after divorce?
The simple answer is no. Sell the house. There are at least two good reasons for this. First reason, you avoid arguments. Because if one of the spouses wants to keep the house - or even both want the house to themselves, things get complicated. Then there is a regular argument about the price for the share of the other. These situations always escalate when too many emotions are involved and common sense is ignored. The causes are manifold. Parents want to keep their children in the familiar environment or the spouses think of the many hours of personal work that goes into the house. Very often then those who absolutely want to keep the house have to pay an inflated price to the other person for it. Also remember that expert reports cost money and do not always reflect the immediately and actually achievable sales price. If you sell the house together, both spouses also bear the same sales risk. If the spouses cannot come to an agreement on the house, there is still the option of applying for a division auction after the divorce. The second reason to sell your home is the cost of upkeep. Because being a homeowner is not always as easy and beautiful as the advertising of the building societies suggests. There can be hidden liabilities or obligations that hit you suddenly. Think, for example, of possible future contributions to road expansion, urban redevelopment, or maintenance of the drinking water or sewage network. You should also think of the costs of regular maintenance work on the house and the time it takes to look after the property in your free time. Mowing the lawn, cutting hedges, clearing snow and weeding also cost you either time or money. You may have to pay the maintenance costs for the house in addition to the maintenance payments. Therefore, it is often easier to sell the house and start over.
An appraisal of the house can be helpful.
Whenever the house is transferred to one spouse in the event of a divorce and the other is to be paid out, the question of value arises. Is it enough just to have the house appraised or does a real appraisal have to be drawn up. There is no one-size-fits-all answer for this. It depends on the spouses themselves. The appraisal costs money. The costs depend on the house value and the effort involved in the valuation. Since July 1st, 2010, property has been valued in accordance with the Ordinance on the Principles for Determining the Market Values of Property (ImmoWertV) of May 19, 2010. The ImmoWertV is supplemented by a guideline of 11.01.2011 for the determination of standard land values according to § 10 ImmoWertV. The real asset guideline (SWRL) of 05.09.2012 must also be observed. Decisive for the valuation is the market value (= market value), which is generally based on the price that is due on the valuation date in normal business dealings according to the legal circumstances and actual properties, the other properties and the location of the property, regardless of unusual or personal circumstances would be achieved. The market value is determined using the comparative value method, the discounted earnings method and the real value method, or several of these methods. However, the real value is still decisive. Especially when calculating the gain, it is often necessary to determine the value of real estate in preparation for legal proceedings. Experience has shown that the ideas of the spouses often differ widely. An appraisal report commissioned by just one spouse does not always help. Because the other is not bound to such a private report. Each spouse can also withdraw from a jointly commissioned expert opinion if they do not agree with the result. This can be remedied by a previously concluded arbitration report. It is also conceivable - albeit as a last resort - an independent judicial evidence procedure about the property value. This would also avoid the double cost burden of two private reports.
How the common house affects the profit sharing in the event of a divorce.
Spouses without a marriage contract usually live in a community of gains.It will end when the divorce becomes final. If a spouse has acquired wealth in the marriage, he has made a profit. If one spouse has made more profit than the other, a profit compensation must be paid. So far so good. If a house belongs to both spouses together, both have achieved an equal gain in the marriage. The exact value of the house is then irrelevant. The following example shows this:
Anton and Berta have no assets when they marry. 20 years later they get divorced. Anton and Berta jointly own a single-family home. Berta still has shares worth € 50,000.00. Anton and Berta get into an argument about the value of the house. Anton thinks the property is worth € 300,000.00, Berta means € 400,000.00.
Solution for a house value of € 300,000.00:
Anton gains: € 150,000.00 house
Berta gain: € 150,000.00 house + € 50,000.00 shares = € 200,000.00
Difference in gains: € 50,000.00
Gain equalization (1/2)
Payment from Berta to Anton: € 25,000.00
Solution for a house value of € 400,000.00:
Anton gains: € 200,000.00 house
Berta gain: € 200,000.00 house + € 50,000.00 shares = € 250,000.00
Difference in gains: € 50,000.00
Gain equalization (1/2)
Payment from Berta to Anton: € 25,000.00
In both cases you can see that Berta has to pay Anton an additional 25,000.00 €.
Obtaining an appraisal would not have made sense here!
However, this is not always the case. The bill changes fundamentally when a spouse is in debt in the event of divorce.
What about the home loan after the divorce.
With the breakdown of the marriage, the lifestyle previously used by the spouses no longer applies. The earlier handling, e.g. that the sole earner pays off the debts and the other spouse makes contributions that are regarded as equivalent, for example in the form of housekeeping, has no basis. The cards are thus also reshuffled for joint debts from a home loan or a private loan agreement. The reciprocal relationship, in which the mutual contributions to the common conduct of life stood, has been abolished. Basically, the sole repayment of debt by one spouse now leads to a half compensation claim against the other.
The compensation for the use of the common house before and after the divorce.
If a spouse has moved out of the common house, he can demand payment of a usage fee and the running costs of the house from the spouse who is still living in it for his co-ownership share. This is true up to divorce. If one spouse has to pay maintenance to the other, the compensation for use and the house costs are to be given priority in the maintenance calculation.
For the period after the divorce, the law no longer provides for compensation for use. If one spouse must continue to live in the same house, the other can request the conclusion of a rental agreement. The now divorced spouse living in the house then has to pay rent. The amount of the compensation for use or the rent is based on the local comparative rents.
The peculiarity of a divorce with house and children.
The well-being of the children living in the household can be a reason for assigning the house to the caring spouse for use. The concerns of children always have priority in the fair balance in the context of the apartment allocation. In judicial proceedings, the court order that the house be transferred to the spouse caring for the children can be made if their well-being is only impaired. The decisive factor is whether the family can still have a bearable livelihood under one roof. The interests of the children in particular can lead to the fact that in case of doubt the apartment is left to the parent who has to look after the children, even then at least for the time being - if the other spouse is the sole owner. With the distribution of custody or the determination of who the children live with, the decision about the apartment is often already made; a tendency that leads to the fight for custody of the children also with a view to the home.
These 11 facts should be clarified before you make a decision about the house.
You are reading this article because you already know that something is changing. They worry. You're upset, maybe even headless at the moment. You don't want to make mistakes, don't want to suffer harm. You are wondering how to go on. What if I tell you there is a solution and you already have a powerful tool for it. Your common sense, namely. The solution is in front of you. All you have to do is take action and get the facts together. Only make a decision if you know all the facts, data and figures. Then nothing can go wrong. You should be certain of the following:
- What is your actual disposable income.
- How the house affects upkeep.
- How much wealth you have acquired in your marriage.
- How the house affects the profit sharing.
- Whether there is a prenuptial agreement.
- Who is registered as the owner in the land register.
- Whether the bank releases the transferring spouse from the loan.
- What are the monthly costs for the house.
- What is the house worth.
- How much living space you really need.
- How flexible you want to be in the future, financially and locally.
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