2 Factors that determine the separation of assets in divorce and tips to follow if you decide to do things amicably
Unfortunately, not all marriages end in a happily ever after. Some end in divorces. When this happens, there will be tough decisions to be made and hard discussions. Sometimes, couples agree amicably on how to divide the properties. However, this is not always the case. Most times, the main question that couples find difficulty in deciding on is, who will own the house? In this article, we will look at 2 factors that determine how marital property is divided during a divorce.
Type of divorce
There are two main types of divorces.
- Contested divorces. This happens when couples can’t agree on how to separate properties, who should be the custodial parent of minor children, and if they have disagreements about property rights during divorce. In this case, each of the spouses is represented by a lawyer. Thereafter, a judge makes a settlement after listening to both sides. This kind of divorce is very expensive, takes longer, and is very tedious.
- Uncontested divorces. This type of divorce is quick and easy. Both couples agree on all terms together without the need for an attorney. Since there are no court proceedings, it saves on money, time, and spousal disputes.
State where you currently reside
It is important to know the legal system of the state you are in before you start listing your items and how it categorizes your property. Property is divided in two ways; community property or equitable distribution of assets.
- Community property: Some states classify property as either separate or community.
Separate property includes:
- Inheritance acquired before marriage.
- Gifts or pension given before marriage.
- Cars or real estate owned individually before marriage.
- The property you acquire after you have legally separated from your spouse.
- Awards received by one spouse during the marriage due to an injury
- Business owned before marriage. However, a court may find that the business grew or made more profit during marriage and if both spouses worked there.
Community property is everything you acquired together during the marriage. This could be:
- The money you have both placed in a joint account.
- Houses or cars bought with both community and separate funds after marriage.
- Retirement earnings.
- Household items.
- Debts.
- separate property that has been mixed with community property to the point that it can’t be split out
- Any item that was purchased with money earned while in marriage.
During a divorce, community property is divided equally among the couples involved. Each spouse also keeps their separate property. For people who reside in Maryland, for example, and would like to use a lawyer to help with the process, here are the best divorce lawyers in Maryland.
- Fair (Equitable) distribution (also known as common law). In all other states, separation of assets in divorce is fairly done although not equally. To make the settlement fair between spouses, the state may order one party to use their separate property. However, the court may look at several factors to determine divorce property division. These are
- The number of children (minor) you have.
- The overall physical and mental health of each spouse.
- Earning potential and income of each spouse.
- Length of the marriage.
- Debts and assets of each spouse.
- Sacrifices are made for the other spouse, for example, for their career growth.
It is important to note that the division of assets on divorce does not necessarily mean everything gets divided physically. Instead, a judge may decide that each spouse gets an equivalent value of the property. To understand better on equitable distribution of assets and how the court makes its decisions, read here.
Dividing assets yourselves
Sometimes, couples agree that it is best to divide property themselves. This process will be much easier on involved parties and doesn’t cost as much. During this process, be fair, honest, and open with each other. Before we dive into some steps you can follow, be sure to check out this website. It has all the information you need in regards to what the law states about asset distribution and much more.
- Make a list of all your belongings. The first and oblivious step is to know what you have in total. For this step, both of you need to be present. Feel free to omit items that both of you agree are personal and items that don’t have much value. Note that if any spouse fails to list an asset in this stage and the other spouse finds out later, they have a right to ask the judge to reopen the case for reevaluation. The guilty spouse will potentially lose assets or incur penalties and fines from the court.
- Note property value. First of all, agree on authority or appraiser you can go to when you can’t decide the value of something. Then, agree on a specific amount that measures the value of the property. If it proves difficult to value something, ask your appraiser to value it.
- Decide on who gets what and why. Starting with the biggest valued items, go through the list and decide with logical reason who should get what piece of property. If there are things you can’t decide on, put them aside and come back to it after a few days with fresh and clearer minds.
- Draft a settlement agreement. Once you have agreed on all the terms of debt and property division, create a settlement agreement that you shall present to the judge. To be sure that you haven’t made any mistakes, it is wise to ask a lawyer to review the agreement.
- Get approval from a judge. Once you have finished dividing the assets and are content with everything, a judge will approve the agreement you have reached. The exemption will only occur when one party without an attorney seems to have walked away with lesser assets. In this case, the judge may appoint a lawyer as no court will rule on unfair distribution of assets. Once they are satisfied, they approve the agreement.
In conclusion, dividing assets in divorce doesn’t have to be a tedious job. If both parties are willing to work together, the process becomes much easier and faster. Remember to be civil with each other regardless of which process you choose to follow.
