Dividing your property when going through a Florida divorce can be challenging because there is marital property and nonmarital property and marital property gets divided equally, Florida Statute 61.075(5)(a)(2). Determining what is marital property and nonmartial property has been a challenge, even for the courts. If you buy a home before the marriage, then technically, it is nonmarital. However, the Florida Supreme Court recently came out with an opinion stating that a nonmarital home, that was under a mortgage during the marriage and now has equity, can be a marital asset. The court laid out the following guidelines for determining whether the home’s equity is marital or not, most of which will be determined through the divorce proceeding:
First, the fair market value of the home must be decided. Basically, what is the home worth in today’s market? Both parties will want appraisals done and sometimes can reach an agreement on this figure.
Second, the court has to decide whether here has been passive appreciation. The court has to determine if the home has gained value because of changes to the market. In today’s market that is probably not the case, but it depends on when the home was purchased.
Third, once a passive appreciation is determined, it must be decided whether that appreciation is marital or nonmarital for purposes of division. In order to show that it is marital, then there has to be proof that marital funds were used to pay for the home. There also has to be a determination as to how much those contributions raised the value of the home.
Fourth, the court must determine what portion of the passive appreciation occurred during the marriage. And finally, fifth, the court must determine how to best divide and allocate the passive appreciation as determined under equitable distribution.
In order to best understand your rights, what should be divided and how, it is best to speak with a Florida divorce attorney.