HOW DOES THE TITLING OF A PROPERTY COME INTO PLAY DURING A DIVORCE?
A key part of divorce is separating property between the two spouses. This area, like most aspects of divorce, can create extremely bitter and complex arguments that make resolution impossible without going to court. When the property at issue involves titles—such as automobiles and real estate—keep in mind that the way it is titled is not dispositive of who will receive that property at the conclusion of your divorce. Additionally, the property division may require modifying documents to reflect the property's equitable division. Below is a discussion of common issues dealing with property titles and divorce.
Effect Of Property Titles During Property Division:
Kansas is an equitable distribution state. Generally, property that an individual brings into a marriage is treated as that spouse’s sole property. However, in an equitable distribution state, upon filing for divorce, all other property is treated as marital property belonging to both parties. The court will make an equitable distribution, meaning the goal is a fair division between both parties. Thus, regardless of how property is titled, it can be distributed to either spouse. And this division won’t necessarily be a 50/50 split between the parties; instead, it will be determined by several factors. These factors, listed in K.S.A. 23-2802, include the ages of the spouses, the length of the marriage, earning capacities, family obligations, and the manner in which property was acquired.
Titling property in one spouse’s name is certainly not worthless, however. In fact, the titling of property folds into the K.S.A 23-2802 factors. The court will likely find the title to be strong evidence of the source and manner of acquisition for property. Fairness will also be a factor in the division, and the titling suggests a specific interest in property that the court should consider. The court In re Marriage of Takusagawa noted that titling is a strong indication of a party’s intentions to keep specific property separate, particularly when no other explanation is offered for why only one name appears on the title. And because the ultimate goal of property distribution is a fair result, titling can prove to be helpful objective evidence of what the parties considered “separate” property.
Titles Of Property Following Divorce:
When property is divided during a divorce, the parties may be required to change the title of the property. This commonly occurs in the real estate context. Couples often purchase homes together, titling the real estate in both their names. A standard court division requires one party to retain the house and repay the other spouse for his or her share of the equity. The non-possessing party’s name may need to be removed from the title as part of this process. Failure to do this can result in difficulties selling the house for the retaining spouse and responsibilities arising from the property for the non-retaining spouse. Everyone’s interests are served by “cleaning up” the titles to property, even absent a court order to do so.
Titling may also need to be adjusted based on the couple's debts. Again, the court will divide debts between spouses. Debts attached to specific property, such as a mortgage on a house or a car loan, will likely need to be refinanced.
Titling property serves several purposes. In the context of a marriage and divorce, titling can be beneficial information for the court to consider. It is important to remember that the title to property does not settle who will receive it. In practice, courts are rarely influenced by how an asset is titled. The court's ultimate goal is always to achieve a fair distribution of property. Further, failing to adjust titles can result in difficulties long after the divorce with creditors or buyers of property. It is essential to consult competent, experienced legal counsel on these issues to ensure the property is titled in a way that supports a fair, agreeable division.