There are various motives behind home purchases. However, renting works just well until one marries or desires to start a family, at which point the need to own one's own home is virtually always felt. To make it happen and build a home they can call their own, the husband and wife work together. Savings from many sources quickly add up. Fast loan applications are made (banks are only too eager to assist them to materialise their dream).
The "perfect" property is carefully chosen, loan applications are efficiently completed, and the registration date is rapidly approaching. Not all couples will find happiness in their new house, much to their dismay and regret; some will find their disagreements "irreconcilable" and move toward separation, which is known as divorce in legal terms. The dream home that was purchased in good times will be caught in the crossfire of this family strife.
What will now happen to this house?
It is important to highlight here that according to law, a property is recognized as belonging to the person on whose name it is registered before we move on. Legally, any other party's contribution, whether in cash or kind, during the purchase cannot be recognized unless there is sufficient evidence to the contrary.
Dividing it into pieces
The wife would be entitled to assert a claim if the property was listed as a joint asset of the soon-to-be-former married couple. The court will give her a part of the property in consideration of her contribution. If the property is only registered in the woman's name, she will be entitled to claim it completely unless the guy can show that he was involved in the acquisition. For instance, his account statement could demonstrate that he has been making his monthly loan repayment instalment payments. Additionally, his account information would demonstrate that he paid the down payment at the time of purchase. In the event that the property is not registered in the wife's name, she may also cite these specifics as evidence of her contribution.
The government offers some advantages to women in order to promote property ownership. They pay less stamp duty for property registration in practically all states. Women buyers in Delhi, for instance, pay only 4% of the transaction value in stamp duty, whereas men must pay 6% of the cost of the home. In order to save money, properties are frequently registered in the name of the household's female member.
Similar to how many banks charge women less for house loans than they do for males, the household may wind up saving a significant sum of money if the loan is taken out in the name of the woman of the home. For instance, a woman borrower can currently get a home loan at SBI for 6.95 percent a year. Men pay a seven percent annual interest rate. While these perks could be useful when things are going well, if things start to go south in the relationship, things could alter.
In the eyes of the law, the asset belongs to the person in whose name it is registered; in the views of the bank, the borrower would be liable for loan repayment. The law gives the wife ownership of a property if it is solely registered in her name and she is the only person applying for a mortgage. This ownership of assets and liabilities, however, is reciprocal. In a harmonious marriage, one spouse may be able to pay the EMI because the other has been covering the other bills. You are left alone if you get divorced.
The court will determine the contribution made by each party and divide the asset in the event that the property is registered in the joint names of a married couple and both are co-borrowers. However, the debt would be repaid by both parties. Remember that the bank just cares about getting its money back at this point. They are not particularly concerned with how a divorcing couple makes things work. Then there is the possibility that the man of the home, who is also the only borrower, has the property registered in his name. In certain situations, the Hindu Marriage Act of 1955, which governs Hindu law, forbids the woman from asserting any claims at the time of divorce.
The person whose name the property is held in will be considered to be its legal owner if a property is bought and paid for by one person but the title is held by another. It's crucial to mention before moving on that this law accepts the property on which his or her name is registered. Unless you can demonstrate differently, contributions made during the purchase of any other party, whether in cash or in-kind, are not recognized legally.
Joint Property Ownership
The woman will be allowed to claim if the property is listed as a joint asset of a couple getting married. The court will award him his share in proportion to his contribution to the property. Until the guy can demonstrate that he contributed to the purchase, the woman will be able to claim the property in full if it is totally registered in her name. The property should be owned jointly for a number of reasons:
• Stamp-duty exemption for female investors
• Tax advantages of joint ownership
• Loan eligibility rises, and repayment is made simpler.
• Divorce Settlement of Jointly Owned Property
Couples who are divorcing frequently have questions and confusion about how to divide the assets they own together. The issue arises because there is insufficient documentation and the separation event is not taken into account when buying jointly.
Property Division at the Time of Divorce
1) Division by consent:
If there is mutual understanding between the parties, the division of jointly owned property can go smoothly. Three things can go wrong with this:
According to equity/contribution, the partners receive their respective shares.
2) Documentation of Contributions Made for the Purchase of Property:
Even though the other partner contributed money overall to the purchase, the person holding the title is the owner. To receive a fair share, the other partner must demonstrate the financial contribution he made.
3) Self-acquired or inherited property:
This type of property is not included in the divorce settlement. The settlement excludes assets that may be inherited in the future. The property becomes the spouse's self-acquired property and is not subject to settlement at the time of divorce if the partition or succession of paternal property is carried out by the law and the husband has received his portions.
4) Joint property disposition in accordance with Section 27 of the Hindu Marriage Act:
The Hindu Marriage Act, 1955, has a provision for the disposition of property presented to a spouse or jointly at the time of marriage. The joint property acquired following marriage is not covered by this section. However, the court may record any agreement the parties have had regarding such assets at the time the decree is issued if the parties have reached such an agreement.
Even after a divorce, the right to maintenance includes the right to a place to call home. The provisions of the divorce decree, though, govern the right. According to Hindu law, either party may request an award of maintenance pendant light and permanent alimony.
The fact that the property was acquired following the marriage would not be relevant to the discussion. Simply put, in the event of a divorce, a wife has no right to claim her husband's independently gained property. The Marriage Laws (Amendment) Bill, which would allow women to inherit a portion of their ex-estate, husbands have lain dormant in Parliament since 2010 and is almost certainly going to be abandoned. The woman requesting a divorce is also not permitted to claim the man's inherited ancestral property. Purchasing a home involves a lot of financial and legal commitments. It is important to consult with a divorce lawyer to understand the specific implications and legal rights associated with property ownership during divorce proceedings.
A common solution to the financial burden of purchasing a home is to purchase the home jointly with family members, especially a spouse. It is common for men to purchase real estate with their funds and register it in their spouse's name in order to take advantage of the reduced property registration fee for women. It is possible that the wife is still the owner in this case.