THE AURIT CENTER Splitting assets and debts equally in a divorce can make sense if both spouses shared them equally during marriage. But 50/50 divorce law can present problems in other cases, leading to long, costly court cases. And as court cases drag on, attorney fees pile up quickly. The costs may even cause spouses to have to sell their home to pay their divorce lawyers.
Mediation offers a less expensive, more straightforward and peaceful approach.
This article discusses whether California has a 50/50 law and, if so, how it would affect the process. We also examine why mediation is the best approach for spouses to reach a calm resolution.
A 50/50 divorce or community property state is where assets acquired during a marriage are divided evenly between divorcing spouses. This includes both marital assets and marital debts.
In 50/50 divorce states, it doesn’t matter who made more money or acquired more material assets or debts during the marriage. All community property is split in half.
Is California a 50/50 divorce state?Yes, California is a 50/50 divorce state. But this law only applies to community and commingled property. It doesn’t apply to separate property. More on this below.
California has three categories of property:
Let’s discuss how these property types differ.
Community property includes assets and debts acquired during the marriage:
Community property division law requires splitting everything bought and owed. Here are some examples:
Since debt is considered an ‘owned item’, one spouse isn’t solely responsible for it in a 50/50 state. Instead, debts are shared and subtracted from the total assets.
Separate property is property owned (or debt that’s owed) before the marriage or after the separation.
It can come in many forms such as items that are paid off before the marriage starts. An example would be a vehicle that’s paid off before the marriage is official.
In contrast, a car purchased during a marriage is paid for using community money. So, if you bring debt into marriage (such as a loan for a car), it becomes part of the community property. This is true even if the car is in only one spouse’s name.
There are some exceptions to community property in California. These include:
For purchases made after the divorce, they can be separate unless the purchase is made with funds that are considered community property.
Commingled property is part community, part separate. So, it contains aspects of both previous types of property.
This may seem confusing, but it’s fairly simple.
Pension and retirement assets are examples of commingled property. They can follow people throughout their lives. This means you can have a retirement plan before marriage and keep it through the marriage.
In this case, what you pay before the marriage is separate, and what you pay during the marriage is community.
Of course, this doesn’t only refer to assets. A home mortgage made before marriage can also be commingled property.
Bottom line: The amount paid or earned before marriage is separate, and anything paid or earned during marriage is community.
If you’re unsure how this works and want professional help, it’s best to consult a mediator. A mediator can help you reach mutually acceptable agreements.
Mediators guide you through the process of property division. They help clarify your divorce settlement agreement and make the process easier for your family.
How does the 50/50 rule apply to debts during the marriage?The 50/50 rule applies the community property standard to everything, including debts.
So even if only one spouse has a credit card during the marriage, the money owed is considered marital property. No matter how you agree to split debts, The companies you or your spouse owe money to may request payments from both of you. As a result, missing a payment can impact both of your credit scores.
But community property doesn’t mean that each individual asset or debt must be split equally. It just means that the total of your assets and debts are divided fairly.
Debts are subtracted from assets during the divorce settlement process, and these community debts can be shared. If you prefer not to share, you can work to pay off the debt as soon as possible, ideally before the divorce is complete.
Otherwise, one spouse can be given more marital assets in exchange for taking on more debt. Even when you both agree on the division of debt, debtors can legally seek repayment from both of you.
Some exceptions exist. One exception to the 50/50 rule is student loans. The education earned is considered a separate asset since you can’t “share” a degree. So a student loan belongs to just one spouse.
The community money paid toward the student loans could be reimbursed to the student who didn’t earn the degree.
A divorce attorney can argue your case in court in these situations. However, in nearly all cases, mediation is a better approach, whether or not you and your spouse are aligned on most issues.
In California, final divorce papers are submitted to a court. The final papers contain your agreements on everything from custody to property. But you both have a choice as to how you reach these agreements, inside of or outside of a courtroom.
If you choose this approach, a family court judge makes all of the decisions.
First, you and your spouse must share financial records and information during the divorce process. You must complete this within 60 days of filing. Afterward, you go through trial divorce proceedings. Here, your lawyers argue regarding property division, child custody, and child support terms.
Some couples have prenuptial agreements or “prenups” that lay out how their property must be divided. These agreements help protect assets in divorce.
In California, the date of separation is also important. If one spouse moves out, or simply tells the other they want divorce, that date can be considered the official separation day. That affects how earnings and payments are treated.
Determining the separation date can be tricky when both spouses live at the same address. The judge may determine the date of separation if the spouses disagree.
If airing your issues in a public forum, racking up attorney fees, and getting into arguments doesn’t sound appealing, we hear you. And there’s a better way.
This brings us to mediation.
Going the mediation route allows you to avoid an expensive and frustrating public trial. Instead, it’s a private and collaborative process where you discuss property division under guidance from a skilled expert divorce mediator.
Here, you’ll share your concerns with a third-party mediator who will help you reach mutually acceptable agreements. They will then draft your agreements and send them to you for your review and approval.
Afterward, the agreements are presented to a judge, who will then certify it. But you and your spouse never have to go to court.
Mediation is far more affordable, faster, and easier and for everyone involved, including kids. You and your spouse stay in complete control of the agreements you reach in mediation, and you can choose whether or not you choose to follow California law.
Schedule a free one-hour consultation to meet with an Aurit Center Certified Mediator and learn more about how mediation can work for you.
Property splitting isn’t always simple. This is especially true when you choose to go to court.
California wants to ensure a fair division of assets for all. But a litigated divorce can take 9 months to 2 years to conclude. Here are some examples of difficult property separation situations:
With these more complex scenarios, court proceedings can take longer. But a mediator can work through difficult scenarios quickly, helping to clarify what the courts might take months (or even years) to do.
California’s 50/50 rule is meant to ensure fair division of assets. But a judge won’t understand your situation like you do.
A mediator works closely with you to understand your circumstances. Below, you’ll find four ways mediation can help address community property issues.
Arbitration and litigation discourage conversation and fuel the fire of arguments. But you and your spouse may simply need to have a conversation in mediation to decide complex property splits and work your way through the property division process.
Mediators can help simplify this process. They focus on ensuring both spouses’ needs are considered. If you have a family business, student debt, or a property that may or may not be classified as community, mediation can help you understand your options. Mediation allows you to reach creative solutions.
Litigation can cost tens of thousands of dollars—oftentimes hundreds of thousands. It often requires an up-front retainer plus a steep hourly rate. When divorce lawyers exaggerate a client’s issues, it increases the amount they charge.
On the other hand, mediators help you avoid expensive, drawn-out court processes. They ensure agreements are made as efficiently and painlessly as possible.
Aurit Center Certified Mediators keep pricing simple to protect your financial stability–now and into the future. We charge a flat fee for our services, with no surprise costs. Plus, our prices are 90% less than the average cost of litigation.
Mediators provide a safe space for both spouses to share their concerns. This space encourages a more collaborative approach where creative options are considered.
Mediation reduces conflict and encourages cooperation. This protects your family, and especially, your children, giving you a healthier path through the divorce process.
4. Not subject to a judge’s external opinionWhile most California judges are impartial, they’re not infallible. Judges might have a perspective that doesn’t align with either spouse’s wishes.
When using divorce mediation, you write the agreement before it goes to a judge. This means you won’t feel pressured by family lawyers or the legal system approach to spend more time and money. Instead, all decisions are up to you.
Here are answers to some common questions about California’s 50/50 law:
California doesn’t set a specific period of time needed to get half of everything in a marriage. Instead, it focuses on what the spouses owed and owned during marriage.
If you had a short marriage, you will likely have fewer joint assets. Longer marriages with few purchases might be similar.
In either case, a qualified mediator can help you decide on a fair sharing of community assets.
Quasi-community property is not community property but is treated as such for the division of property in a divorce. It comes into play when a married couple moves to a community property state with property they acquired while living in a non-community property state.
This kind of property is still community property. It is not an exception to California’s 50/50 rule. As such, it’s split just like any other asset or debt.
For example, let’s say you live in Iowa, purchase a vehicle, and decide to move to California while still married. That vehicle would fall under California 50/50 divorce law.
However, if you only live in California for a couple months each year and you live in another state most of the time, that’s different. Your divorce might fall under that state’s laws and you would file there.
California is one of the few states that has community property laws. Despite the good intentions behind these laws, they can backfire when spouses feel stuck or limited in their options — leaving them both unsatisfied. As such, knowing the ins and outs of these laws can help you understand your options and ensure both spouses benefit from the agreements reached.
The Aurit Center firmly believes better resolution for both parties occurs through mediation.
To learn more about why mediation is the best choice, contact our team for a free one-hour consultation.
