The emotional upheaval of divorce is often made even more stressful by the anxiety of possibly losing the family home, the car and family heirlooms. During a contested divorce proceeding, property division is determined by the laws of the state in which the couple resides. There are two basic ways of treating the division of marital property, guided by the state laws for community property or equitable distribution.

Michigan is an equitable distribution state, which means that a judge determines what is fair and equitable. Instead of splitting the property evenly, he will make the distribution based on a number of factors. The final ruling will divide the total value of marital property as percentages to both sides.

How is marital property value determined?

The court categorizes property in two basic ways:

  • Marital property is all of the assets the couple acquired during the marriage, including real and personal property, income, investments, pensions and retirement funds. It also includes debt accumulated during the marriage, such as a mortgage, car loans and credit card debt
  • Pre-marital assets and debts include any property, gifts or inheritance that was given to either or both spouses before marriage, as well as any debts such as college loans

Since the judge must know the value of all divisible property as well as debts, both spouses will have to determine assets by their fair market value. For an asset that is not marketable, however, a spouse can estimate its replacement value based on what it would cost to replace the item.

Who gets the house?

Once the valuation of the entire estate is determined, the judge will make his ruling based on many factors. In a situation where one spouse contributed more to the expenses of the marriage, that spouse may be awarded a higher percentage.

The easiest way to divide shared property, like the family home, is to sell the property and divide the income. In proceedings where there are young children, however, the court will often award the family home to the spouse who has primary custody.

If a couple decides to end their marriage but not to divorce, Michigan law allows them the status of separate maintenance. When the couple files for separate maintenance, the judge divides the property equitably, just as he would in a divorce.

It is important to get informed advice on the handling of complex issues of property division and how a judge is likely to treat marital assets.