Los Angeles Divorce (2025 Guide) –
For most couples, the family home is their largest asset—and often the most emotionally charged. With LA’s competitive housing market and rising interest rates, deciding what happens to your home during divorce requires careful strategy. Here’s how courts typically handle this in 2025, and what options you really have.
California’s Default Rules on the Family Home
1. Community Property Basics
– Homes purchased during marriage = 50/50 split
– Pre-marital homes may become “commingled” (partially community property)
– Refinancing during marriage often changes ownership status
2025 Twist: Rising interest rates make buyouts more complicated than in 2020-2022
Your 5 Main Options
1. Sell Now & Split Proceeds
Best when:
– Neither can afford the mortgage alone
– You want clean financial separation
– The market favors sellers (like 2025’s inventory crunch)
Process:
1. Get 2-3 broker opinions
2. Agree on listing terms
3. Divide proceeds after paying off mortgage
Tax Note: Up to $500k capital gains exclusion still applies if lived there 2+ years
2. Buyout by One Spouse
How it works:
– Get current appraisal (not just Zestimate)
– Subtract mortgage balance
– Paying spouse gives other half the equity
2025 Challenge: With 7%+ mortgage rates, qualifying alone is tougher
3. Keep Joint Ownership Temporarily
Common structures:
– “Birdnesting”: Kids stay, parents rotate
– Post-divorce co-ownership: 1-5 years max
– Rental income split: If keeping as investment
Our Advice: Always set an end date in writing
4. Offset with Other Assets
Example:
– Spouse keeps $800k home
– You get $400k from retirement accounts
– Avoids refinancing hassles
5. Let the Court Decide
Risks:
– Judge might order sale when market is low
– Could get unfavorable buyout terms
– Lengthy process (LA courts backlogged)
Special LA Considerations
1. Prop 13 Tax Base Transfers
– Preserve low property tax rates
– Requires careful paperwork
– New 2025 forms streamline process
2. ADU Complications
– Who gets the rental income?
– Access rights to main house?
– Valuation challenges
3. Earthquake Retrofit Costs
– Older homes may need $20k+ in upgrades
– Affects home’s net value
– Liability issues post-divorce
3 Mistakes That Cost Home Equity
1. Delaying Decisions (Market shifts hurt)
2. Overlooking Hidden Costs (HOA special assessments, deferred maintenance)
3. Emotional Overbidding (Keeping house at financial breaking point)
How We Protect Clients
✅ Certified Appraisers (Not just Redfin estimates)
✅ Mortgage Experts (For solo qualification strategies)
✅ Tax Strategists (Capital gains planning)
✅ Parenting Coordinators (When kids are involved)
“We thought we’d have to sell our Hancock Park home. Hayat structured a creative buyout that kept our daughter in her school district.”
— Recent Client
Get a Custom Home Strategy
Every situation is unique. Call (310) 917-1044 for solutions tailored to:
– Your mortgage status
– Local market conditions
– Family needs
