Community Property vs Separate Property - Explained
Marital and Separate Property
If you still have questions or prefer to get help directly from an agent, please submit a request.
We’ll get back to you as soon as possible.
- Marketing, Advertising, Sales & PR
- Accounting, Taxation, and Reporting
- Professionalism & Career Development
Law, Transactions, & Risk Management
Government, Legal System, Administrative Law, & Constitutional Law Legal Disputes - Civil & Criminal Law Agency Law HR, Employment, Labor, & Discrimination Business Entities, Corporate Governance & Ownership Business Transactions, Antitrust, & Securities Law Real Estate, Personal, & Intellectual Property Commercial Law: Contract, Payments, Security Interests, & Bankruptcy Consumer Protection Insurance & Risk Management Immigration Law Environmental Protection Law Inheritance, Estates, and Trusts
- Business Management & Operations
- Economics, Finance, & Analytics
What is Community Property and Separate Property?
This property designation further concerns the ownership of real property by legally married couples. It applies to real and personal property. As explained above, ownership of property as tenants by the entirety would control with regard to real property. Generally, property held by a married couple is either classified as marital property or separate property.
Next Article: Easement or Right of Way Back to: PROPERTY LAW
What is Marital Property?
Is owned equally by both spouses and each spouses consent must be present to legally sell the property.
What is Separate Marital Property?
Belongs to one spouse or the other. It does not require the consent of both spouses to sell or transfer.
There are two systems in the United States for determining whether property is marital or separate. One system follows the common law rule and the other follows the community property rule.
What are Common Law Martial Property Rules?
Common law states that martial or separate property is determined by whose name is on the title, who purchases the property, or who receives it as a gift.
What are Community Marital Property Rules?
In states observing community property rules, all property acquired during the marriage is considered marital property, with the exception of property acquired before marriage, property inherited, or received as a gift. This rule is analogous to the concept of property owned as tenants by the entirety. This rule becomes important in the event of divorce between the parties. The court will be forced to determine who owns property.
- Example: Tom and Jane are married. Their primary possessions are a home and a car. Determining who owns the property will depend on whether it is marital property or separate property. If the state is a common law state, whoever's name is on the title to the home and car own it. If it is a community property state, ownership depends on whether the home or vehicle was acquired by an individual prior to marriage or pursuant to a gift or inheritance. If it was purchased during the marriage, it will be considered community property.
Which do you believe is most fair to spouses, community property laws or equitable distribution laws? Why? What is an argument for or against following equitable distribution principles? Community property principles?
Ervin and Betty are husband and wife. Over the years they have acquired several parcels of real estate. The real estate is always registered in Bettys name. Terry, a general contractor, approaches Betty about purchasing one of the properties. Who has the right to sell the property? What do we need to know about the law of the jurisdiction to answer this question? Why?
- In community property states, most property acquired during marriage (except for gifts or inheritances) is considered community property (owned jointly by both partners) and is divided upon divorce, annulment, or death. Separate property is owned by one spouse only. It is property purchased by one spouse, titled to once spouse, or property that a spouse brings into the marriage or receives via gift or inheritance during the marriage. In a community property state, spouses own equally almost all property that either one acquires during the marriage, regardless of whose name the property is in. From the example in the practice question, whether Ervin and Betty have equal rights to sell of any of their properties will turn on whether the state is a community or separate property state. This is true, regardless of the fact that Bettys name is on the deed.
- Property Law (Intro)
- Tangible and Intangible property?
- Knowledge Capital
- Calculated Intangible Value
- Real and Personal Property?
- Littoral Land
- Readily Removable Fixtures
- What is ownership?
- Role of Government in ownership of property?
- Allodial System
- Role of property rights in economic activity?
- What are the limitations on property ownership rights?
- What is nuisance?
- What is Zoning?
- What is Eminent Domain?
- Just Compensation
- What is Property Taxation?
- Assessment Ratio
- Millage Rate
- Homeowners Association (HOA)
- Rule of First Possession?
- Lost or Mislaid Items?
- Adverse Possession?
- Establishing and transferring ownership in real property?
- Absolute Title
- Warranty Deed
- Register of Deeds
- What is a fee simple interest in real property?
- Absolute Interest
- Restrictive Covenant
- What is a life estate in real property?
- What is a leasehold estate in real property?
- What are common types of co-ownership relationships in real property?
- Owning Real Estate Personally vs as LLC
- What if Co-Owners of Real Estate Want Out
- Community Property and Separate Marital Property?
- What is an easement interest in real property?
- What is a license of real or personal property?
- Bundle of Rights
- Absorption Rate
- Fair Housing Act
- Federal Housing Administration (FHA)
- Housing and Urban Development (HUD)
- National Housing Act
- Design Build Contract
- Building Permits
- Certificate of Acceptance
- Construction Surety Bond
- Acquisition, Development, and Construction Loan (ADC)
- Flipping (Real Property)
- Buy, Strip, and Flip
- Homeowner Affordability and Stability Plan
- Building Residual Method
- Accessory Dwelling Unit
- Property Management
- Cost-Plus Contract
- Real Estate Investment Fund
- Listing Agreement
- Property Lawyers
- Multiple Listing Service
- Home Equity
- Register of Deeds
- Title Search
- Opinion of Title
- Certificate of Title
- Abstract of Title
- Chain of Title
- Clear Title
- Cloud on Title
- Defective Title
- Defect of Record
- Action to Quiet Title
- Affidavit of Title
- Warranty of Title
- Title Insurance
- American Land Title Association (ALTA)
- Earnest Money
- Private Mortgage Insurance
- Closing (Property)
- Settlement Statement
- Real Estate Settlement Procedure Act (RESPA)
- HUD-1 Form
- Closing Statement
- Closing Costs
- Buying Real Estate as an LLC
- What is a mortgage?
- What are the Rights of a Mortgage Holder?
- Deed of Trust or Security Deed?
- Trust Deed
- Certificate of Release
- Judicial Foreclosure
- Lis Pendens
- Short Sale
- Homeowners Protection Act
- Deed in Lieu of Foreclosure
- Tax Deed
- Tenancy at Will
- Closed End Lease Definition
One Percent Rule
- Net Lease
- Triple Net Lease (NNN)
- True Lease Definition
- Land Lease Option
- Hell or High Water Contract
- Habendum Clause
- Implied Warranty of Habitability
- Emblements Definition
- What is a bailment?
- Unilateral-benefit and mutual benefit bailments?