What's yours is mine and what's mine is yours and everything from both of us. This could be a quick and simple definition of what is considered joint property, although the regulations are a little more specific regarding possessions and assets.
In fact, it is important to be clear about what is considered joint property and what is involved in a joint property regime before getting married and even if you are already married. This way you will avoid major mistakes if, unfortunately, love ends.
What are community property?
Marital property is property that belongs to both spouses in a marriage under a community property regime or a joint property regime.
In other words, the concept itself is defined by the type of marital property regime, since in marriages with separation of assets the assets of both spouses remain separate before and after the marriage.
Article 1344 of the Civil Code establishes that “through a community property, the profits or benefits obtained indiscriminately by either of them become common to the spouses, which will be attributed to them equally upon the dissolution of the community property.”
According to this definition, all property obtained during the marriage in community property, regardless of who obtained it, will be considered community property. For practical purposes, this includes:
- The salaries of both spouses.
- Income or interest from joint or separate property of either spouse, such as rent from a home or the return on an investment. This also includes winnings from gambling. If you win the lottery, it will belong to both of you.
- Assets acquired by either spouse.
- Companies created by either spouse using joint assets.
What assets are private in marriage?
Community property is not universal. Even if both spouses share everything, there are assets that will not be community property and will have a separate character.
The first will be those that belonged to each spouse before the marriage. Everything that each one contributes to the partnership will be private, although its profits will be joint property. For example, the rent of the house purchased before getting married will be joint property, but the house itself will not.
Property acquired free of charge during marriage is also considered to be private property. That is, inheritances and donations. If you inherit money or it is donated to you, it will be yours and not the property of the community of property, even if you were married.
Along these lines, any asset acquired at the expense of or in substitution for private assets will also be private. An example would be a home bought with money from an inheritance or an inherited home that you sell to buy another.
Compensation for personal injury to one of the spouses or their property, the instruments necessary to carry out your work or objects of great value for personal use are also not considered community property.
Can joint property be separated?
With a community property regime, most of the money and assets purchased during the estate will belong to both parties. This matrimonial regime is the one applied by default in most autonomous communities.
Unless the future spouses indicate that they prefer the separation of property or the participation regime, they will marry under community property.
However, it is also possible to separate property while married. To change from joint property to separate property, you will have to sign new marriage agreements.
These marriage agreements serve to define the economic regime of the marriage and to change it if necessary. It is a procedure that is carried out before a notary, like the signing of the mortgage.
To change the marital regime from joint property to separate property, the assets acquired during the marriage must first be divided equally.
Community and separate property: the example of the house
How does all this work in practice? There is nothing like a couple of examples with the house to fully understand the difference between joint and separate property before and during the marriage.
What happens with a house purchased before getting married? The house in question will be a separate asset, regardless of the marital regime. Even in the case of joint property, it will be separate property because it was acquired before the marriage.
What if the house had a mortgage and was paid off during the marriage? In that case, the house will also be private property, even if it was paid for with joint property. However, in the event of a divorce, the other party could request the reimbursement of half of the amounts paid with joint money.
There is also an exception. According to article 1357 of the Civil Code, if the house becomes the habitual residence of the couple and is paid for with joint property, it will become joint property.
One option in this case would be to subrogate the mortgage to include the second spouse in the loan or sign a new mortgage as a couple to improve the conditions of the loan.
In any case, this is a good example of why it is important to plan your marriage well beyond the wedding.
