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  1. #1
    Tirith Guest

    Separated and Buying a House

    What is the name of your state? CA

    My husband and I have been living separately since January, 2003. He has an apartment in another town 25 miles away, and I’m still renting the house we lived in when he moved out. Our son (14 years old) lives full-time with me. Soon after my husband moved out and got his place, we divided our “assets” (household goods) in a way that was satisfactory to us both.

    Our separation is very amicable. We have agreed on an amount of money he gives me each month for support of our son and the bills we still pay jointly. We both still make limited use of a joint bank account, and are on the same insurance policy. Our son visits him regularly.

    We have not pursued a formal legal separation or divorce, and we don’t want to file at this time for several reasons, including health coverage. There is no official record that we are separated, other than his apartment rental history.

    As I understand it: “California law - specifically Family Code Section 771 - provides that a spouse's earnings and accumulations received while living separate and apart from the other spouse are characterized as separate property.”

    My daughter and I are about to purchase a house together. I want to be sure that the purchase and title will be in my name—and my daughter’s—ONLY, and that my husband will have no legal rights and/or responsibilities to the house, our home loan, or the proceeds from the sale of the house in the future. He should not be connected to this purchase legally in any way.

    Question:
    What must I do to make this a safe/legal arrangement? How can I prevent anyone “upsetting the applecart” later down the road?
  2. #2
    divgradcurl is offline Senior Member
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    What must I do to make this a safe/legal arrangement? How can I prevent anyone “upsetting the applecart” later down the road?
    You need to see an attorney. The Family Code section below would appear to work in your favor -- but the fact that you still have a joint bank account works against you, and the "amicable asset division" you did does NOT change the nature of the assets -- if they were community property before the "amicable division" they are almost STILL community property now.

    Further, unless the down payment you will be putting towards your house is SOLEY of separate property (that is, money acquired AFTER the separation), then the sue of community funds to purchase the house may give him some interest. Further, even your credit score may be considered a "community asset," at least in part -- so unless your daughter's credit score is the only one the lender uses to fund the house, then again, it is possible that your use of a communty asset to help fund the house may give your husband an interest.

    Remember -- the presumption in California is that ANYTHING aquired during marriage is community property -- its up to the person claiming it to be separate property to prove otherwise. Staying married for the sake of health insurance COULD be seen as "working a fraud" and therefore a court might be inclined to say that maintaining a marriage and joint health insurance is INCONSISTENT with "separate property" assets and turn everything into community property.

    Hence, the reason for my first advice -- see a lawyer before you do anything. There are ways to get around these presumptions, but you want to make sure you do it right -- there's too much potentially on the line if you mess it up.
  3. #3
    Tirith Guest

    Separated and Buying a House

    I’m even more confused now about other issues! Can you please clarify?

    …the fact that you still have a joint bank account works against you…

    Why? We each have separate personal accounts for bill paying, etc. The joint account is for getting his monthly support payment to me quickly. He writes a check to me from his personal account (in a different bank) and walks across the street to deposit it in the joint account for me to access. I don’t have to wait for him to mail it, for me to get to the bank and deposit it, and wait two days for the check to clear.

    …the "amicable asset division" you did does NOT change the nature of the assets -- if they were community property before the "amicable division" they are almost STILL community property now...

    What does this mean? I got most of the new furniture; he wanted our old furniture, most of the electronic equipment, and the boat (things I didn’t care about). We owned no real estate property, and had no savings. We each have a decent car, licensed in our own name. We are both happy with this division and feel it is equal. What else is at issue?

    …unless the down payment you will be putting towards your house is SOLEY of separate property…

    The down payment is coming from my daughter. I provide the good credit and stable employment history for the loan.

    …Further, even your credit score may be considered a "community asset," at least in part…

    How would this be true? My credit is my own, based on my car payment history, etc. His history is not particularly good, but it doesn't influence mine.

    …Staying married for the sake of health insurance COULD be seen as "working a fraud"…

    Without staying on my husbands insurance, I could not get any on my own. I have cancer, and I’d be turned down because of preexisting conditions. He has agreed to keep our son and me on the policy, and pays me less each month than he would have, to offset the deduction from his pay for health benefits.

    If seeing a lawyer is the best thing to do, is there place or type of lawyer I can go to for free or inexpensive information?
    Last edited by Tirith; 07-21-2004 at 05:05 PM. Reason: misspelling
  4. #4
    divgradcurl is offline Senior Member
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    Without going point by point, the reasoning behind the answers to your questions is this: in California, if you are married, besically everything is considered to be community property. If you are in the process of dissolution, and all you have left to do is wrap up the paperwork, then the law will cut you a break and allow you to be "seperate" and acquire separate property.

    In you case, however, you maintain a joint bank account and joint insurance -- the courts COULD decide that you are not completely "separated" and are not showing the requisite "intent" to completely dissolve your union, and may decide to apply the marital presumptions to your property, even though you acquired it while seperated. You can't have it both ways -- you can't take advantage of still being married yet take advantage of being separated.

    It doesn't mean it WILL be this way, but it does mean that it potentially COULD be this way. That's why you need to see a lawyer to get this all sorted out.

    My credit is my own, based on my car payment history, etc. His history is not particularly good, but it doesn't influence mine.
    It's this way because the courts say so. It doesn't mean that the courts WOULD find that use of your credit history would give rise to a presumption of community property, but it COULD find that, in some cases.

    What does this mean? I got most of the new furniture; he wanted our old furniture, most of the electronic equipment, and the boat (things I didn’t care about). We owned no real estate property, and had no savings. We each have a decent car, licensed in our own name. We are both happy with this division and feel it is equal. What else is at issue?
    Anything "acquired during marriage" is community property -- that means each of you owns everything together. Until the dissolution is blessed by the courts, you still each own an undivided 1/2 share of the community property.

    Again, the problem here is that you are trying to "divorce" -- and therefore get out from under the community property rules -- without "divorcing." The courts don't like that. That's why you need a lawyer. Hopefully he or she will be able to get everything sorted out for you.
  5. #5
    divgradcurl is offline Senior Member
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    Forgot about this:

    If seeing a lawyer is the best thing to do, is there place or type of lawyer I can go to for free or inexpensive information?
    Many attorneys provide free or low-cost initial consultations. Click on the attorny finder above, or let your fingers do the walking...
  6. #6
    Happy Trails is offline Senior Member
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    Very good posts.

    Couldn't she put the title solely in the daughters name?

    She could still be on the mortgage. Maybe the daughter and her could have a legal document stating that after the divorce is final--the daughter would agree to add her to the deed. Or would that appear fraudulent?
    Last edited by Happy Trails; 07-21-2004 at 06:39 PM.
  7. #7
    Happy Trails is offline Senior Member
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    Forget about it.

    I thought about my question, and I do believe it would be fraud.
  8. #8
    divgradcurl is offline Senior Member
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    I thought about my question, and I do believe it would be fraud.
    It may or may not be fraud -- the OP's problem is that she is in this kind of weird limbo region, where nothing is really set in stone one way or the other -- if she simply buys the house, she may be fine. But it's uncertain enough to make it worthwhile to go an see an attorney who can review ALL of the facts, and figure out a way to do what she wants so that there is no way for it to come back and bite her.

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