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What Happens If There Is a Separate Property Interest in Your House?

What Happens If There Is a Separate Property Interest in Your House? If there is a separate property interest in a house? The court has only two options: award the house to the spouse with the separate property interest or order to sell the house.

If a spouse has any amount of separate property interest in a house, the trial court does not have the ability to award the property to the other spouse. According to Eggemeyer v. Eggemeyer, 554 S.W.2d 137, (Tex. 1977) “[t]rial courts have a broad latitude in the division of the marital community property, but that discretion does not extend to a taking the fee to the separate property of the one and its donation to the order.” In other words, as long as there is some separate property interest of one party in a house, the court may not award that house to the other spouse.

For example, in Whorrall v. Whorrall, 691 S.W.2d 32, 36-37 (Tex. App.— Austin 1985, writ dism’d), the trial court found that a husband owned a .9% separate property interest in a marital residence, having contributed $500 of his separate property to the down payment of the house. The trial court awarded the house to his wife, and in his appeal, the husband relied upon Eggemeyer. The Austin Court of Appeals agreed with the husband, and held even though the amount of husband’s separate property in the house was less than 1%, “the trial court may not divest one spouse’s fee interest in realty and award it to other spouse.” The court further held that the error could not be harmless because it had caused an improper judgment. 

Therefore, even if it is de minimus, a court cannot divest a spouse of his or her separate property interest in a house. Once the separate property interest is proven, the trial court can only award the house to the spouse who has the separate property interest or order that they sell the house.

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