Legal Question in Family Law in California

Before we were married, my spouse and I purchased a home in a community property state (California) as tenants-in-common, with both of our names on the mortgage (so we each owned 50% of the property and 50% of the debt before we married). To date, I've paid 100% of the mortgage payments using my salary. In the event of a divorce, would a portion of those mortgage payments be reimbursable from my wife back to me because I was paying for her separate debt with my separate assets (before our marriage) and our community assets (during our marriage)? Would I be right to calculate that 50% of my mortgage payments prior to our marriage would be reimbursable (representing 100% of her half) and 25% of my mortgage payments during our marriage would be reimbursable (representing 50% of her half)?

If so, if we were to refinance now, would future mortgage payments I make going forward no longer be considered 25% reimbursable because the new mortgage would be considered community debt? And would the reimbursability of my prior historical mortgage payments be impacted by it?

Asked on 4/07/21, 2:30 pm

1 Answer from Attorneys

Timothy McCormick Law Offices of Timothy McCormick

As to your first question the answer is, "no." You have the reimbursement structure backward. Reimbursement is for separate property used to pay a community debt, not the other way around. Theoretically you could claim reimbursement for 50% of the payments made before marriage, but in the absence of a tenants in common agreement or prenuptial agreement, it would be a "he said, she said" as to whether those payments were a gift, and/or balanced by expenditures she made. The most likely outcome if it were disputed is you would be entitled to 50% of the principle paid, but not the interest. Since that was early in the loan, when each payment goes mostly to interest and only a little to principle, that amount is not likely much.

You are correct as to the impact of a refinance. However, that would not change anything from what is happening now, which is community property (your income) being used to pay separate debt (her 1/2 of the mortgage). Once you are married, only separate property used to satisfy community or separate debt is reimbursable in divorce. (Where that most commonly arises is when post-separation income is used to continue making payments on community debt before the divorce is final).

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Answered on 4/08/21, 1:25 pm

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