Equalization of marital gains

Equalization of Gains - Equalization of gains is the legally regulated division of assets between spouses upon termination of the statutory matrimonial property regime of community of accrued gains, particularly in the event of divorce. It ensures that the increase in assets achieved during the marriage is divided fairly between both partners.

How the equalization of accrued gains works

Under the statutory matrimonial property regime of community of accrued gains-the default regime when no prenuptial agreement has been entered into-the assets of both spouses remain separate during the marriage. Only upon termination of the community of accrued gains is each partner’s so-called accrued gains determined. The accrued gains are the difference between the final assets (as of the date the divorce petition is served) and the initial assets (as of the date of marriage).

The spouse who has accrued the higher amount must pay the other spouse half of the difference as compensation. For example: If Partner A has a gain of 300,000 euros and Partner B has a gain of 100,000 euros, the difference is 200,000 euros. Partner A must therefore pay Partner B 100,000 euros as equalization of gains.

In most marriages, the real estate is the largest asset and plays a central role in the equalization of accrued gains. The decisive factor is the market value as of the effective date-that is, not the original purchase price and not a future desired price, but the current market value at the time the divorce petition is served. An expert appraisal is generally obtained to determine the value. Any outstanding loan obligations are deducted from the market value.

If the property was acquired or inherited before the marriage, it is considered part of the initial assets and is included in the marital gains only to the extent of its appreciation during the marriage. An inheritance or gift received during the marriage is added to the initial assets and thus remains exempt-even if the value of the gifted or inherited property increased significantly during the marriage.

Valuation Date and the Significance of Current Market Values

Since the market value of the property as of the date the divorce petition is filed is decisive, the exact timing can have significant implications. During periods of rising real estate prices-such as in Nuremberg from 2015 to 2022-the value of a property may be significantly higher than it was at the time of moving in or the original purchase. Those who file for divorce early can, depending on market conditions, influence whether a higher or lower market value on the valuation date applies.

Both parties have the right to commission their own appraisal. If the appraisals differ significantly, the family court will appoint a neutral expert upon request. The court-ordered appraisal is then binding for the calculation.

Alternatives and Options

Spouses can modify the statutory matrimonial property regime through a notarized prenuptial agreement. The most important alternative is separation of property, in which no equalization of accrued gains takes place-each spouse retains their entire estate. Another option is the modified community of accrued gains, in which, for example, real estate is excluded from the calculation.

Such arrangements are particularly useful when one partner brings real estate into the marriage and does not want to be forced to sell it in the event of a divorce. A prenuptial agreement can also be entered into retroactively-that is, during the marriage-though prenuptial agreements entered into later are subject to stricter judicial review for unconscionability. For example, anyone who enters into a prenuptial agreement that is unilaterally advantageous shortly before a separation must expect a court to classify it as unconscionable.

Practical Tip for Nuremberg and Franconia

In the Nuremberg metropolitan region, real estate prices have risen significantly in recent years. This means that even if a property was acquired before the marriage, the increase in value during the marriage can be substantial and significantly influence the equalization of accrued gains.

We recommend that property owners in Nuremberg, Fürth, and Erlangen have the current market value of their property determined by a certified appraiser at an early stage-ideally as soon as the separation process begins. This helps avoid future disputes over the property’s value and clarifies the negotiating position. We are happy to refer you to suitable appraisers in the region.

Frequently Asked Questions

Does the property have to be sold for the equalization of accrued gains?

No, there is no obligation to sell. The spouse liable for equalization may also fulfill this obligation using other assets. In practice, one partner often takes over the property and pays the other-this requires refinancing and the financing bank’s consent to the debt restructuring. If the remaining assets are insufficient, an installment plan can be agreed upon or a loan can be taken out.

How is the value of the property determined for the equalization of accrued gains?

The market value as of the date the divorce petition is served is decisive. This is generally determined by an expert appraisal in accordance with the provisions of the Real Estate Valuation Ordinance (ImmoWertV). Outstanding loans are deducted from the market value to determine the net asset value. If the parties cannot agree on an appraiser, the family court will appoint one.

Can the equalization of accrued gains for the property be excluded?

Yes, through a notarized prenuptial agreement, spouses can exclude the property entirely or partially from the equalization of accrued gains. This is possible both before and during the marriage. We recommend seeking advice from a specialist family law attorney for this, as such agreements may be deemed contrary to public policy by courts under certain circumstances-especially if they are one-sidedly disadvantageous to one partner.

When is a prenuptial agreement worthwhile from a real estate law perspective?

A prenuptial agreement is particularly recommended if one partner brings real estate into the marriage or has inherited it and wishes to protect it; if one of the partners is an entrepreneur and the real estate should not be included in business liability risks; or if there are significant differences in assets that could lead to unfair outcomes due to the equalization of accrued gains. A notary and a specialist family law attorney can provide expert advice on the available options.

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