If your spouse acquired the home through inheritance, a court may find that the home is characterized as that spouse’s separate property. However, you may be able to pursue a reimbursement claim for having reduced the principal amount of the debt owed on the home if funds used for the mortgage payments came from your separate estate or the community estate.
In a divorce proceeding, a reimbursement claim is usually sought when one marital estate has provided a benefit to another.
The estate pursuing a reimbursement claim for payments made towards the principal balance on a mortgage for a separate property home will need to trace the funds used to make those payments. Appellate courts have split regarding whether the community presumption applies in this situation, so it is best practice to keep a thorough record of these payments so that you can prove which funds were used to benefit your spouse’s separate estate.
The estate seeking reimbursement will likely not recover the entire amount of the payments made. Rather, the recovery will likely include an amount representing the reduction of the principal amount of the mortgage. In other words, the estate seeking reimbursement will recover the value of the actual benefit the other estate received. Be sure to maintain documentation of the mortgage and when it was acquired.
If you have questions or concerns about a potential reimbursement claim in your divorce, contact our office to speak with a Kirker Davis attorney.