What Happens To Property I Purchase When Separated From My Spouse If We Get Divorced?
When a couple gets divorced in Michigan, the parties will have to divide their property or the court will order the division of the property. The first step is to determine whether the property is marital or separate. Marital property is subject to a roughly equal division and separate property is awarded solely to the party that owns it.
Pretty much any property that comes to either party during the marriage is going to be considered marital property; regardless of which party earned the income to purchase the property, which party purchased the property or how the property is titled. Separate property refers to specific categories of property; inheritances, gifts specifically to one party (such as the wedding or engagement ring) and property that one party owned before the marriage. The separate property must also be kept separate from other marital property and income earned during the marriage cannot be spent to maintain or improve the property. If this occurs, then the separate property will become marital property and subject to division.
In cases where the couple has separated but one party has purchased real estate or other property of value, there is a strong argument that the property is marital and subject to an equal divisoin. Case law has established that property acquired by one spouse "after the parties manifest their intent to separate" should still be considered a marital asset, but the presumption that the property should be divided equally does not necessarily apply. Depending on the circumstances the "nonacquiring" spouse may be entitled to a lesser share. However, in a recent unpublished case I just read, the parties separated in 2013, in 2015 the plaintiff acquired a duplex that generated rental income, the parties divorced in 2016. Because of the facts of that case, the divorce court ended up awarded the duplex to the defendant (the other party) but it should be noted the equity in the duplex was questionable due to a mortgage and substantial tax liens.
In most cases, if the parties are separated and one party is contemplating purchasing a new home or other valuable property, then it is wise to seek counsel regarding a "post-nuptial agreement" or filing for divorce. If you have questions regarding separation or divorce, please do not hesitate to contact my assistant, Cathy, at (248)608-4123 to schedule an appointment or contact us through the web site.