Q: Divorcing in Oregon after 10 year marriage. My wife purchased home 5 years before we married. Am I entitled to equity?
I equally invested in payments and improvements over the 10 years. We refinanced about 3 years ago in both our names.
A: Short answer: yes. There is a presumption of equal contribution to marital assets. You might look at the equity in the home at the time of the marriage, and set that aside for her. All of the equity growth since that point would be looked at as marital property.
Tim Akpinar agrees with this answer
Generally speaking the marital portion of the equity would be the increase in value from the date of the marriage to the date of the divorce. That portion would be divisible under Oregon's presumption of equal contribution. The equity from the date that your wife bought the house until the date of the marriage would be her separate property. To figure the numbers out you need proof of the fair market value of the house at the time of the marriage and at the time of the divorce. The purchase prices is the fair market value when she bought the house. If you can't agree on the numbers you can hire a professional appraiser. But if you and your wife can discuss this calmly, you should be able to come up with a number that you can both live with.
The next problem is figuring out how to extract the portion of equity that you might be entitled to. If your wife wants to keep the house she will need to see if she qualifies to refinance the house and take your name off the mortgage right now. She also needs to see if she can pull money out of the refinance to pay you off. She can explore giving you another asset in the marriage to offset what she owes you but be careful that the values are calculated correctly. For example if she want to give you some of her IRA the dollars are before tax amounts so you need to adjust the amount to what it is worth after tax so you are comparing apples to apples.
Also sometimes right after a divorce a person can't refinance but they may be able to refinance in a few years. If you want to be nice about it, which can save you money in Attorney's Fees, you can agree to postpone getting your payoff for a few years, like five years, and instead take a Judgment for your share of the equity which will become a lien against the house with interest at 9% (the default rate of interest on Judgments in Oregon) and the stipulated divorce judgment could specify that your ex has 5 years to refinance and pay you off, otherwise the house needs to be listed for sale and your judgment paid in full, or something to that effect. You will want an Attorney to help you write up the Judgment.
Any way these are just ideas based on what I have seen in other divorces I have handled. It really pays to make an appointment and talk to an Attorney about your own unique situation. I find that once a client comes in to my office and we go over the facts of their situation and what they want the outcome to be, I will usually see that there is one clear solution over the other options that I can recommend.
Tim Akpinar agrees with this answer
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