Finances Involved in a Texas Divorce

In navigating Texas divorce finances, it’s imperative to comprehend two primary areas of focus. The first aspect involves actively ensuring the well-being of any children involved through child custody arrangements. The second revolves around financial matters, encompassing assets such as your family home, business, and retirement accounts. In this blog post, we’ll concentrate on dissecting the financial components critical to comprehending in a Texas divorce case. While each divorce is unique, I aim to shed light on common and pervasive financial topics that could affect you.

Your family home

The central component to your short-term financial life is the family home. For most of us, we will not make a larger expenditure in our lives than the purchase of a home. The home, whether you’ve lived in it for one or five years, is central to both finances and family life. Consider key factors about the home, like its role in the divorce and post-divorce plans.

You should determine whether your family home is Community property. If the house was acquired during your marriage, it’s likely considered community property. It can be divided in the divorce between you and your spouse. It doesn’t matter if neither your name nor their name appears on the note or deed to the home. As long as the home was acquired during your marriage, it’s still considered Community property.

Considerations and financial impact

If you purchased the house before your marriage, it constitutes separate property and is not divisible in the divorce. However, it’s essential to acknowledge that if community property income contributed to mortgage payments or home improvements, your spouse may have potential reimbursement claims that you should consider. Otherwise, prepare for the house to be an issue that you must deal with financially during the divorce itself.

Once you confirm the house is Community property, weigh your options for its handling during the divorce. In most divorces, one spouse will leave home while the other remains in the house. Oftentimes the spouse who chooses to remain in the house will do so. They will raise the children in the house for the duration of the divorce. If you want primary custody of your children after the divorce, stay in the house as long as possible. Choosing to leave home voluntarily may suggest to some judges that you’re less committed to full-time childcare. It may give the impression that you are not as interested in being in the house after the divorce, either.

Another aspect of homeownership that is relevant in a divorce is the decision to remain in the house after the divorce or sell the home as part of the divorce proceedings. Typically one spouse will move out of the house as a condition of the divorce. After the divorce concludes, the spouse who chooses to remain in the house or is awarded the house is responsible for making any mortgage payments on the property. This presents several different financial issues that you need to be aware of as you finish out your divorce case.

Affording the family home

If you are awarded the house in a divorce, can you afford to remain there? You may often request something in the divorce without being prepared to handle the consequences of actually obtaining it. The family house is something that many people would like to be able to maintain and live in after the divorce is over with period; it may be that you have received primary custody of the kids and want to stay in the house to increase the stability of your children’s lives after the cases come to a close. I can’t say that I would blame you on many levels for having this feeling.

However, it’s crucial to recognize that the payments on the house have likely been made jointly with your spouse. Now that you and your spouse are divorcing, your income will significantly decrease. You must assess your budget and determine whether you can afford to make those payments solely on your income. The last thing you want is to strain your budget to the limit before even adjusting to life as a single person with a new budget.

As a result, you and your attorney should perform a somewhat detailed analysis of your finances after the divorce to determine whether or not it is in your best interest to remain in the house after the divorce. Even if you desire to remain in the house and you think a judge would award the house to you, that does not mean that it is in your best interest. On the contrary, it may be in your best interest to have the house sold in the divorce and to take the cash you make off the sale to fulfill some other financial obligation that you have.

Key documents for handling the family home in divorce

If you decide to remain in the house, two documents must be executed as part of your divorce proceedings. The first document is a deed of trust to secure assumption. This document is signed by your spouse and then by you. The purpose of the deed of trust to secure assumption is to enable your spouse to protect themselves after the divorce if you stop making payments on the home. For example, if your house were to go into foreclosure after the divorce, this deed of trust is a secure assumption that would allow your spouse to secure the home and make payments on it. They would be able to take an ownership interest in the house and not have their credit ruined by you not making payments on a home that bears your name and your spouse’s name on the note.

The other document that I think will be wise to execute in this scenario would be a special warranty deed. The special warranty deed would benefit you in that your spouse would deed over to you all of their interest in the home moving forward. This would prevent them from getting in your way if you wanted to sell the home or otherwise income for the home with a home equity line of credit or perform any other action with the house. Both of these documents are essential to the proper handling of a family home after a divorce. Do not let your case conclude without asking your family law attorney about the significance of these documents.

How to divide your community estate

We have already discussed Community property to a certain extent in this section on your marital residence. Community property is divisible in a Texas divorce. You should expect any property or debt accumulated during your marriage to be on the table as eligible for division. Your house likely represents a good chunk of your community state along with personal property, vehicles, investments, and simple checking or savings accounts.

Once your community estate is defined, you and your spouse must negotiate the division of the property within it. If fault grounds for the divorce are not being asserted, other factors may influence how your Community property is divided in a trial. These factors include your and your spouse’s ages, educational backgrounds, work history, health, and the number and value of separate property items you own.

These are the factors that a family court judge would look to when dividing up your property. However, it is unlikely that your divorce case will reach a judge to discuss this topic. That should tell you that you should be anticipating the negotiation session with your spouse rather than preparing to make arguments with a judge. You and your spouse are fully capable of creating your outlook and method for distributing and dividing your community into a state. As long as the method you choose doesn’t violate basic issues of fairness, it is likely that a judge would approve those methods.

Child support

As the primary conservator in your divorce, you’re entitled to child support from the possessory conservator. This amount is based on the number of children under 18 or not yet graduated from high school. The court assesses various factors, including the number of children, and follows Texas family code guidelines. For example, if there’s one child, the guidelines usually recommend 20% of the possessory conservator’s net monthly income for child support.

The percentage increases by up to 50% for each additional child before the court. Note that the Texas family code guidelines are suggestions, not mandates, for you and your spouse. Nevertheless, based on my experience, these guidelines are commonly adopted by most individuals navigating a divorce. That said, if you have specific circumstances that warrant deviation from the guidelines, it’s advisable to consider doing so. Factors such as the health and well-being of your child, logistical considerations regarding your ex-spouse’s ability to visit with the children, or other unique expenses not typically encountered in divorce proceedings may influence your decision.

You and your spouse know your family circumstances much better than anybody else. As a result, you all should feel motivated to negotiate with one another over any subject, specifically child support. This can be a very personal subject since it involves receiving money from an ex-spouse to help support your children. It is best to look at a way to support the kids and not exact any “payback” against your spouse. It may be that you will need to re-enter the workforce after your divorce. This may be your reality but is not something that child support is intended to assist you with.

Spousal maintenance/Contractual alimony

Spousal maintenance and contractual alimony are two forms of post-divorce financial assistance. While commonly referred to as alimony in many states, Texas distinguishes them into two categories. Here’s a breakdown of each and the eligibility criteria:

Spousal maintenance is only ordered by a judge after a divorce trial. The judge evaluates whether you can meet your basic needs post-divorce. If not, and your spouse can financially support you, the judge may order them to pay spousal maintenance, often around 20% of their gross monthly income.

If you and your spouse agree on post-divorce financial support, you can choose contractual alimony payments. It’s akin to contract law, so a family court judge’s role is limited to enforcing your divorce decree terms. If your spouse doesn’t pay, the judge can only enforce payments if they’re less than spousal maintenance would have been.

A judge determines spousal maintenance based on your separate estate and accessible community property. It’s only granted if you lack other sources of income, and if you have available property that could sustain you, spousal maintenance is unlikely to be awarded.

The crucial point is that, unless domestic violence is involved, you and your spouse must have been married for at least ten years for spousal maintenance to be ordered. The duration of spousal maintenance can be extended with longer marriages.

Final thoughts on the finances involved in a Texas divorce

In the realm of Texas divorce finances, numerous aspects of your financial situation are inevitably affected. Simultaneously, divorce brings forth financial considerations that likely weren’t prevalent before. Rather than feeling overwhelmed, let this serve as a catalyst for thorough preparation. Being proactive, setting clear objectives for your case, and engaging in constructive negotiations with your spouse are vital for navigating divorce successfully. Maintaining focus on your priorities and having well-organized financial plans are crucial steps.

To set meaningful goals, understanding the financial implications of your decisions is paramount. This underscores the importance of having a seasoned family law attorney by your side. An attorney who comprehensively understands your circumstances can provide invaluable support. With so much on the line, investing time in consulting with knowledgeable counsel well-versed in Texas family law is invaluable.

Questions about the material contained in today’s blog post? Contact the Law Office of Bryan Fagan

If you have any questions about the material contained in today’s blog post, please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed family law attorneys offer free-of-charge consultations six days a week via phone, online, and in-person meetings. These consultations are a great way for you to learn more about the world of Texas family law and how your family may be impacted by the filing of a divorce or child custody case.

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Other Articles you may be interested in:

1. Read this blog post before moving out of the family home in a Texas divorce
2. Divorce and Real Estate: Splitting the Family Home
3. Navigating the Complexities: Determining Ownership of the Family Home in a Texas Divorce
4. I Want a Texas Divorce but My Husband Doesn’t: What can I do?
5. Am I Married? – Marital Status in Texas
6. Can I sue my spouse’s mistress in Texas?
7. 6 Tips – On How to prepare for a Texas Divorce
8. Roadmap of Basic Divorce Procedure in Texas
9. 6 Mistakes that can Destroy Your Texas Divorce Case
10. Does it Matter who Files First in a Texas Divorce?

Law Office of Bryan Fagan, PLLC | Spring Divorce Attorneys

The Law Office of Bryan Fagan, PLLC routinely handles matters that affect children and families. If you have questions regarding divorce, it’s important to speak with one of our Spring, TX Divorce Attorneys right away to protect your rights.

Our divorce attorneys in Spring TX are skilled at listening to your goals during this trying process and developing a strategy to meet those goals. Contact Law Office of Bryan Fagan, PLLC by calling (281) 810-9760 or submit your contact information in our online form. The Law Office of Bryan Fagan, PLLC handles Divorce cases in Spring, Texas, Cypress, Spring, Klein, Humble, Kingwood, Tomball, The Woodlands, the FM 1960 area, or surrounding areas, including Harris County, Montgomery County, Liberty County, Chambers County, Galveston County, Brazoria County, Fort Bend County and Waller County.

Bryan Joseph Fagan( Attorney )

Bryan Fagan, a native of Atascocita, Texas, is a dedicated family law attorney inspired by John Grisham’s “The Pelican Brief.” He is the first lawyer in his family, which includes two adopted brothers. Bryan’s commitment to family is personal and professional; he cared for his grandmother with Alzheimer’s while completing his degree and attended the South Texas College of Law at night.

Married with three children, Bryan’s personal experiences enrich his understanding of family dynamics, which is central to his legal practice. He specializes in family law, offering innovative and efficient legal services. A certified member of the College of the State Bar of Texas, Bryan is part of an elite group of legal professionals committed to ongoing education and high-level expertise.

His legal practice covers divorce, custody disputes, property disputes, adoption, paternity, and mediation. Bryan is also experienced in drafting marital property agreements. He leads a team dedicated to complex family law cases and protecting families from false CPS allegations.

Based in Houston, Bryan is active in the Houston Family Law Sector of the Houston Bar Association and various family law groups in Texas. His deep understanding of family values and his professional dedication make him a compassionate advocate for families navigating Texas family law.