Three Sections Decide What Is Yours, What Is Shared, and How It Splits
Program and regulatory figures verified October 10, 2026. Details change; confirm your scenario with us.
A lender's reading of the three sections that decide the arithmetic, quoted rather than paraphrased, with the limits of our lane stated plainly.
★★ What is community property
Fam. Code § 760, in one sentence:
"Except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in this state is community property."
★★ Note the breadth: all property, wherever situated. A California-domiciled couple's house in another state is reached by this sentence. ★ And note the hinge: during the marriage. Which makes the start and the end of that window decisive, and the end is the date of separation. Which is not what most people think.
★★★ Equal division, and the exception everyone forgets
Fam. Code § 2550 requires the court to "divide the community estate of the parties equally." That is the half people know.
★★★ The clause that opens the section is the half they do not:
"Except upon the written agreement of the parties, or on oral stipulation of the parties in open court, or as otherwise provided in this division…"
★★★ So equal division is the default, not a prohibition. Parties can agree to something else, in writing or on the record in open court. ★★ And there is a neat consequence for the financing: the written agreement § 2550 contemplates is very often the same document Fannie Mae's buyout rule needs to see. Get one document doing both jobs. What the lender needs it to say.
★★ Property in joint form is presumed community
"…property acquired by the parties during marriage in joint form, including property held in tenancy in common, joint tenancy, or tenancy by the entirety, or as community property, is presumed to be community property. This presumption… may be rebutted by either of the following: (a) A clear statement in the deed or other documentary evidence of title… that the property is separate property… (b) Proof that the parties have made a written agreement that the property is separate property."
★★ Two rebuttals and both are documents: the deed, or a written agreement. Not intention, not who paid, not whose money it felt like. ★★★ Which is why, in a California file, the deed is not merely a formality. It is evidence, and it is the first thing we ask for. It also answers the twelve-month joint-ownership question.
★ Where separate money fits
None of the above means a separate-property down payment disappears into the pot. Fam. Code § 2640 reimburses contributions traceable to a separate source, but on terms that surprise people. How that reimbursement is calculated, and why it does not grow.
★★★ The limits of this page, stated plainly
We are a lender. We have quoted three sections because the arithmetic in a buyout depends on them and because people arrive with the wrong version. We are not:
- ★★ telling you what is community and what is separate in your case: that turns on facts, tracing and sometimes case law we do not read;
- ★★ telling you what your division should be, or taking any position on it;
- ★ a law firm, your counsel, or anyone's representative in a dissolution; and we make no attorney referrals.
★★ We also publish no discussion of Moore/Marsden apportionment, Epstein credits or Watts charges. They are real and they matter, and they are case law we did not read at a primary source this pass. Naming a case from memory is how wrong citations get published, so we name none. Everything else we left out, and why.
Mike Certo, NMLS #260555. (480) 296-6513 · mcerto@cfmtg.com.
Frequently asked questions
What is community property in California?
Family Code section 760 provides that except as otherwise provided by statute, all property, real or personal, wherever situated, acquired by a married person during the marriage while domiciled in California is community property.Does California always split everything 50/50 in a divorce?
Equal division is the default, not an absolute rule. Family Code section 2550 requires the court to divide the community estate equally except upon the written agreement of the parties, on oral stipulation of the parties in open court, or as otherwise provided in that division.If the house is in both names, is it community property in California?
It is presumed to be. Family Code section 2581 presumes property acquired during marriage in joint form to be community property, and that presumption can be rebutted only by a clear statement in the deed or other documentary evidence of title, or by proof of a written agreement that the property is separate.Can a mortgage lender tell me what is community and what is separate?
No. We quote the statutes because the arithmetic of a buyout depends on them, but characterising particular property turns on facts, tracing and sometimes case law. We are a lender, not a law firm, and we take no position on how property should be divided.Mike Certo · NMLS #260555 · Cornerstone First Mortgage NMLS #173855 · Equal Housing Lender. Educational content about mortgage financing during and after a divorce. Not a loan commitment, and not legal, tax or financial advice. Cornerstone First Mortgage is a lender; it is not a law firm, does not represent any party to a dissolution, does not make attorney referrals, and takes no position on how property should be divided. California property-division rules are set by the Family Code and applied by the courts; the reassessment exclusion in Revenue and Taxation Code section 63 is administered by county assessors. Agency requirements described here are Fannie Mae Selling Guide provisions current as of the date shown and are subject to change and to lender overlays. Housing market figures describe the twelve months to August 2026 and are not a forecast. All loans are subject to borrower, property and program qualification.