Before a couple is legally divorced in New Mexico, they must agree in writing on the division of marital property—or a judge will decide for them.

Often, the biggest asset in the marital estate is the family home. Who has the right to stay in the home after a divorce is often one of the most pressing matters to resolve—but also one of the most complex.

Reaching a mutually agreeable solution often involves the skills and insight of a seasoned property division lawyer. However, here are some of the basics to help you plan for what lies ahead…

Property division rights in New Mexico

New Mexico is a “community property” state, meaning that marital assets and debts acquired during a marriage are considered to belong equally to both spouses. If the couple divorces, marital assets and debts should be divided equally or as close as reasonably possible to equally.

In relatively simple divorces, couples can often discuss property division matters and reach a mutually agreeable solution. Once this is formalized as part of the separation agreement, the divorce can usually proceed without delay or too much expense or stress.

However, in more complex cases, disputes often arise, mediation is required or couples must collaborate and negotiate with legal representation. In the most contentious divorces, the case must go to court and a judge will decide after hearing evidence from both parties.

The fate of the family home can be central to divorce disputes not only because it is often the largest asset in the marriage—but also because there may be emotional attachments for spouses and the children.

What factors affect what happens to the family home?

Which spouse stays in the family home after a divorce depends mainly on the following factors:

• Homeownership: regardless of what it says on the title, if the home was acquired during the marriage or both spouses have been involved in paying the mortgage, it is usually considered communal property subject to division upon divorce. If the home was fully owned by one spouse before the marriage and the other spouse moved in, it may be considered separate property not subject to division. 
• Desire and ability to keep the home: if there is a desire and capability to keep the family home by either spouse, this will be an important consideration (some spouses don’t want the memories or the monthly financial burden of paying for the family home).
• Total property division: the matrimonial home will be assessed with other property in the marital estate so that calculations can be made on how much each spouse should retain.
• The need to sell the home: if there is a lack of desire or means to retain the family home by both parties (as is often the case), the property may need to be sold.
• Best interests of the children: if one spouse has the desire and means to live in the family home after divorce—and has primary custody of the children—this may influence the decision of the New Mexico courts, which regard the well-being of the children as the priority.

Why does the family home often get sold in a divorce in New Mexico?

Some marital assets, such as savings accounts, are relatively easy to divide 50/50 but others, like the family home and vehicles, are not.

Acceptable valuations of non-liquid assets must be made. If the couple does not want to “liquidate” these assets, they usually work out a fair division where each spouse keeps some assets.

Because the marital home is often the largest asset and cannot simply be divided down the middle, it is often sold and the proceeds from the sale are divided equally between the spouses. Judges in New Mexico generally prefer for the family home question to be decided and included in a separation agreement before finalizing the divorce. 

Awarding the house to one party on the condition of refinancing and buying the other party out at a later time is not generally encouraged because a default on the mortgage can create credit rating problems for both partners.

Often, then, the preferred option is to sell it. The sale price of the home depends on market conditions, equity in the home, improvements made, etc. Spousal agreement on a fair valuation is, however, another potential obstacle to overcome before the property division can be finalized.

Can you be forced to sell the marital home?

Unless you and your spouse can agree on who gets the family home—and one party can afford to take on the financial responsibility of the mortgage immediately after the separation—you may be forced to sell it. This is most likely if the home is considered community property, i.e., both spouses contributed to its purchase and upkeep.

A New Mexico court can order the sale of a property and divide the proceeds between the parties if no other solution can be found.

Tips if you want to keep the family home 

If you desperately want to keep the family home, it’s best not to leave the home during the divorce. Despite what many divorcing couples believe, it doesn’t increase the likelihood of being awarded the home but makes things simpler if they do get to keep it.

You should also calculate what it will cost to keep the home and whether you can afford to refinance the mortgage. If you can take on this financial responsibility, start considering how you can buy out your spouse or make up the value of the house with other assets from the marriage.

What if one spouse owned the house before marriage?

One potential complexity with house ownership after a divorce is when the house is considered part separate property and party community property. This can make a 50/50 split inequitable.

A good example is where one of the parties makes a down payment using their own savings before the marriage and the other party then moves in and starts contributing to mortgage payments, home improvements, etc. 

If inheritance funds are involved, these can further complicate matters as they are usually considered separate property. Prenuptial or postnuptial agreements can also affect property division. Legal assistance from experienced property division lawyers is often required to unravel the situation and broker an agreement between spouses.

For advice on your legal rights, responsibilities, and options during a divorce, book a consultation with a divorce lawyer from Legal Solutions of New Mexico or call us at 505-445-4444.