Going through a divorce can be an emotionally challenging process. However, when it comes to dividing assets, things become even more complex. One of the most contentious issues in a divorce is dividing rental properties. Texas has specific laws that dictate how rental properties are distributed in a divorce. In this article, we will explore the rules that govern dividing rental properties in a Texas divorce.
Community Property State
Texas is a community property state which means that all property that was acquired by either one or both spouses during the marriage is considered community property. This includes any rental properties acquired during the marriage. Property that was acquired prior to the marriage or inherited by one spouse during the marriage is considered separate property.
Division of Property
When it comes to dividing rental properties, Texas divorce courts follow the concept of just and right division. This means that the court’s goal is to divide the marital estate in a way that is fair and equitable for both parties. The court considers several factors when dividing assets such as each party’s earning capacity, health, age, the length of the marriage, and the contributions of each party to the acquisition of property.
Property Appraisal
Before dividing rental properties, the first step is to have a professional property appraisal. This is necessary to determine the value of the property. The court and the parties involved will consider this value to determine the equitable distribution of the rental properties.
Equitable Distribution
Once the rental property has been valued, the court will divide it in a just and right manner. This means that the court may divide the property equally, or it may give one spouse the property while the other spouse gains a larger share of other marital assets to equalize the distribution. The court may also award the property to one spouse and require them to pay the other spouse an equalization payment to balance the distribution.
Buyouts
It’s also possible for one spouse to buy out the other spouse’s interest in the rental property. In this situation, the spouse who wants to keep the property will need to pay the other spouse their share of the property’s value. This can be done through cash payments or by exchanging other marital assets of equal or greater value.
Final Thoughts
Dividing rental properties during a Texas divorce can be a complex and contentious process. It’s important to note that not all rental properties are treated the same, particularly if they were acquired prior to the marriage or through inheritance. It’s essential to seek the guidance of an experienced Texas divorce attorney who can help you navigate the process and protect your interests during this difficult time.