Kentucky Divorce and Your Home: What Happens to the House?

In any Kentucky divorce, the most significant question everyone asks themselves is: Who gets the house?

The family home is one of the most contested assets in divorce, as it is valuable to both sides financially as well as emotionally. Kentucky is an equitable distribution state – that means property is divided fairly, as opposed to strictly equally. 

In this article, we will explore how Kentucky courts handle the marital home, what could affect the division process, and what options spouses have when they are getting divorced. 

Marital vs. Nonmarital Property

Under Kentucky Revised Statutes (KRS) §403.190, before courts determine what happens to the house, they have to decide if it’s marital or nonmarital property. 

Marital property:

• Includes assets and debts which were acquired during the marriage, irrespective of whose name is on the title. 
• If the property was purchased and/or maintained with marital funds, it is usually considered marital. 

Nonmarital property:

• Will typically belong only to one spouse if it was owned before marriage; if it was inherited or received as a gift individually; or if it was purchased with separate funds. 

Importantly, if nonmarital funds were used for the purchase or maintenance of the home, the spouse responsible for that contribution may be entitled to reimbursement, or to a proportional share. 

How Kentucky Courts Divide the Home

Once the courts have classified the property, they will divide it in accordance with equitable distribution principles, whereby they focus on fairness, not strictly on equality. 

Under KRS §403.190(1), a judge will consider:

• How much each spouse has contributed to acquiring and maintaining the property, inclusive of non-financial contributions, such as homemaking. 
• The value of property set apart to each spouse. 
• How long the marriage lasted, and the economic circumstances of each spouse. 
• Whether the spouse with custody needs to remain in the home for the children’s stability. 

This means that, in order to balance the division, one spouse may keep the home, while the other receives a bigger share of other assets. 

Options for Handling the Marital Home

Couples divorcing in Kentucky have several options when it comes to dealing with the house:

• They may sell the home and split the proceeds – this is the most common option when neither spouse can afford the home alone. In this case, the court may order the sale of the property and divide the net proceeds equitably. 

• One spouse can buy the other out – this is where one spouse will keep the home and pays the other spouse their share of the home’s equity value, often through refinancing. 

• Deferred sale (nesting agreement) – this is where the custodial spouse will remain in the home temporarily, often until children reach a certain age, after which the house is sold. Courts sometimes allow this arrangement so that minor children enjoy stability. 

Each of these options will depend on finances, mortgage obligations, and what is feasible long-term. 

What Happens if the House Is In One Spouse’s Name?

In a Kentucky divorce, whose name appears on the deed is not always a deciding factor. Even if one spouse’s name is on the title or mortgage, if the property was purchased during the marriage or with marital funds, it’s still typically marital property. 

However, if the property was owned before marriage, and marital funds were not used to improve or maintain it, it remains as separate property. 

Factors Affecting the Outcome

When judges handle the division of the marital home, certain factors may influence them, such as: 

• If minor children are involved and a stable residence is needed. 
• What each spouse’s income is, as well as their ability to maintain the property. 
• Any debt obligations, or outstanding mortgage payments. 
• Anything that was agreed upon during mediation or settlement negotiations. 

Judges operate with broad discretion in balancing these factors. This is what allows them to make decisions in the fairest way possible for both spouses. 

Why Legal Guidance Matters

Divorce in Kentucky is already a complicated process, and with real estate division in the situation, it becomes a complex legal maze. This is where a knowledgeable Kentucky family law attorney can help you. 

At Hoffman Walker & Knauf, we work with clients faced with dividing property during their divorce every day. Our seasoned attorneys can help you identify marital vs. nonmarital interests, negotiate fair settlements or buyouts, and ensure your home is valued properly. 

If you’re going through a divorce in Kentucky and you’re not sure what will happen to your home, don’t hesitate to contact us today for a consultation. We will work with you to protect your financial interests, and to ensure you don’t overlook hidden equity, tax issues, or any future financial risks. 

Let’s work together in securing the best possible outcome for your family home.