WHO GETS THE HOUSE?

It is crucial for any couple contemplating marriage, or currently married but considering a split, to understand what our law says about who gets what on divorce. Often the most important asset from both a financial and an emotional perspective is the family home.

Your divorce order as issued by the divorce court will be the "final word" here. A variety of factors will be at play here, all linked to the question of what "marital regime" applies to your marriage so the first question you need to ask is whether you are married in or out of community of property - and if out, does accrual apply?

If you are married in community of property

This is the default marital regime for South African marriages, and if you didn't sign an ante-nuptial contract ("ANC") before you married, all your assets and liabilities at the date of divorce (with a few specific exceptions) will automatically belong to both of you in "undivided shares" i.e. 50/50.

Typically, your divorce order and/or consent paper will provide for one spouse to become the 100% owner of the communal home, with a suitable financial adjustment between you to account for the value of the other spouse's 50% share.

No formal transfer of the share in the property in the Deeds Office is needed, your attorney will just arrange for an endorsement on the property's title deed to transfer ownership.

If you are married out of community of property

You have two separate estates and what you bring into the marriage remains yours, as does any growth in asset value during the marriage, depending on whether the accrual system applies or not.

As to who keeps (or gets) the house, and as to how much if anything the other spouse must pay in return, that will depend on a host of factors including the terms of your ANC and whether you were married with or without "accrual".

"With accrual" is the default unless you specifically opt to marry "without accrual". In practice, most modern couples specifically opt for accrual, in which event the difference in growth in value between the estates, if any, during the marriage of your two estates will be split between you.

If the house is currently registered in only one of your names and that spouse is to keep the house, no formal transfer nor endorsement of the title deed will be necessary. If however, the other spouse is to become the registered owner, a full transfer of ownership in the Deeds Office is needed. Although an exemption from transfer duty applies in this case, there will still be other transfer fees and costs to consider.

If you are jointly recorded as owners on the title deed, you may want to transfer the one's share to the other spouse. Again, a transfer will be needed. There is however nothing to stop you from agreeing on a temporary or permanent continuation of the co-ownership after divorce, perhaps to minimize disruption to your children's lives, or perhaps while you jointly market and sell it at the best price (in which event your agreement should specify in detail who will pay what costs, what the minimum purchase price will be, interim arrangements, and so on).

Who pays off the mortgage bond?

If you are currently registered as co-owners, both of you will be equally liable for the full remaining debt owed to the bank. If one of you is the owner and the other is to take transfer, the current owner remains solely liable for the loan debt until released by the bank.

Whichever spouse keeps (or takes over) sole ownership of the house will have to make a new loan application to the bank in his/her own name and be substituted as the sole debtor/mortgagor.

If you get the house, how will you pay out your ex-spouse?

As above, normally there will be a financial adjustment between you to compensate the other spouse, and if you don't have the funds available you may need to ask the bank for a second mortgage. You could of course also agree to sell the house and split the proceeds after settling the existing bond.

Prevention is better than cure...

Your house could well be your marriage's most important asset both financially and emotionally. Rather than fight over it when divorce looms, seek professional advice before you tie the knot on what marital regime is best for you, and on how best to sort out who gets the house if you should be unfortunate to part ways down the line.