I bought my home before marriage
for $550,000 and financed $400,000 (1992) then I deeded the property to my then wife as joint tenancy
with me in 1994 after we were married. In 1994 I had about $150,000 of separate property interest in our home. 1996 I rebuild the home with $450,000 of my separate funds. 1999 we refinanced for $600,000. Then again in 2002 for 780,000 and had a 2002 appraisal for $1,300,000. Unfortunately I deeded to my wife our home as her sole and separate property for refinance purposes 2002 intending to record a joint tenancy deed, but we never did. Home sold by court order for $1,900,000 in 2014. At that time the balance of the mortgage to be paid off was $620,000 and after other costs of sale netted about $1,120,000. We also have about $500,000 in community debt to pay. As we are still working out a settlement I have two related questions:
How would the $500,000 in community debt be paid and is there any case law where deeded separate property interest recognized a spouse’s community interest beyond principle loan pay down?
My laymen interpretation of how the home proceeds of $1,120,000 might be divided. Without calculating mortgage principle pay down I believe first I am to receive my $600,000 in separate funds contributions. Seconded there would be community interest of the appreciation between 19994 to 2002, from $550,000 to $1,300,000 of $750,000. Lastly the appreciation while in my wife name as separate property (2002 to 2014) from $1,300,000 to 1,900,000 of $600,000 or net $440,000 after closing costs.
Here is my dilemma; where doses the $620,000 loan pay off and the community debt of $500,000 get calculated from the $1,120,000 proceeds? And again is there any benefit or argument that the appreciation during the property titled solely in my wife’s name is ***** ***** gain in that I made all the mortgage payments and repairs?