When a marriage ends, it's always a difficult time, even in the most amicable situations.
The division of assets and debts can make it even harder, as no doubt each side has a different idea of what a fair deal is.
When it comes to dividing real estate, many might wonder what California law has to say about recouping payments made on a house purchased during the marriage. Can any of it be reimbursed? It turns out, under certain circumstances, the answer is yes.
California Family Code Section 2640
California Family Code section 2640 spells out what kind of payments can possibly be reimbursed, under the right conditions. These include down payments, payments for improvements, and payments that reduce the principal on a mortgage.
But there is a catch.
What Kinds of Claims are Eligible?
The catch is, to make a reimbursement claim, you must prove that your down payment, or other contribution to the marital home, came from pre-marital assets, or assets obtained during the marriage that were your separate property.
Pre-marriage assets can include money made from the sale of a home before the marriage, a bank account possessed before the marriage, or dividends or other monies earned before the marriage.
A gift made to you alone (and not your spouse) by your family or another third party can also be eligible. For example, if your parents gave you a sizeable sum that you used to help buy the marital house, that sum is eligible for reimbursement.
Payments made for homeowner’s insurance, property taxes or mortgage interest are not eligible for reimbursement.
The Proof is in the Pudding
Of course, the devil is in the details. Discussions about reimbursements are often contentious, so it’s important to have a paper trail that follows the money. Having the appropriate escrow records, deposit records, and bank records can help bolster your case. In the case of gifts from family, sometimes a signed declaration with the help of a family lawyer can help prove that the gift was for you only, and not for you and your spouse.
Nothing is guaranteed with these claims, but the better your documentation, the better your chances.
Want to Know More About Reimbursements for Real Estate in a Divorce?
If you want to know more about California Family Code section 2640 and how you may be eligible for certain real estate reimbursements in your divorce settlement, contact Park Family Law. Whether you need an experienced mediator to amicably and efficiently settle your case or an aggressive litigator to get you the best result in court, Park Family Law can assist you every step of the way.