How To Deal With Assets And Debts For Divorce?
Either you get a quick divorce online or go through a detailed offline process with your family law attorney, you are eager to know the possible outcomes. Among all, you need to foresee the financial results of the divorce process, which will allow you to plan your post-divorce life and care about personal financial safety. More to this, you should be aware of principles and rules on handling your assets and debts all along the divorce to prevent misunderstandings, law problems and get the best possible outcomes in the end.
Get educated on the relevant financial issues and use the help of divorce attorney, financial advisors and other specialists to protect yourself from financial hurdles and care about secured future.
To prepare yourself physically and mentally to financial changes provoked by the divorce, you are to put some efforts and work on the listing and pricing along with other divorce docs.
- Use financial statements – even if you don’t plan to bring our financial issues to court you still can use court divorce forms to manage your assets and debts. Most courts use financial statements forms which work like a guide for you to help you order your debts and assets and not to miss anything.
- Mind the financial disclosure – when partners create lists of their debts and assets they make an agreement for financial disclosure. It means that they promise to e completely open and fair when providing information about their debts and assets. If any partner tries to hide or provides inaccurate information, he\she will undergo penalties and lose benefits in the divorce outcomes in general.
- Provide copies of the documents – when listing assets and debts it is strongly recommended to supplement the list with copies of the appropriate documents. Mind, that words have more power when they are backed up legally.
- Use help to ascertain the value – to evaluate your assets you may need some extra help. The easiest way is to look for a similar property on the Internet and compare to your own. But you should mind the amortization and some improvements you made to your property. But the more exact evaluation can be made by a specialist, such as a financial advisor or professional valuator
You should also hold in mind that not all the assets are evaluated and divided according to the same rules. Some are to be treated differently. So, to avoid misunderstanding and unpleasant surprises, do research beforehand.
- A marital home – home is not counted to other assets and is dealt with separately. There are actually several ways to treat your family house after divorce. The key is that the final choice depends on the agreement of both of the spouses. The first option is to sell the house and divide the profits so that each partner can get a new accommodation if there is enough money. The other way is that one partner can buy out his spouse and leave the entire house for him\herself, though it can be really hard to persuade the other side to do so. The third option is to prioritize children’s comfort and tolerate the custodial parent to live in the family house until the kids are 18 or finish studying. The other partner can take out his neat share, but keep the interest, which means when the time comes to sell the house, he/she will get the profits.
- Separate property – there are assets which count as separate property even if you gain them all along the marriage. They include gifts and inherited property. Yet, you should be able to provide vivid proves of that. More to this, if you mingled separate property with your marital one, for example, moved inherited assets to the joint account or regifted the gifted car to your husband, it will be almost hopeless to distinguish the separate property and it will be counted as marital one.
If you still cannot agree on property and debts division privately, you will have to move your divorce package further to the court. Here you should be prepared, that each state law has its own treatment of fair division. There are usually two ways your property can be divided, leaning on the state you live in:
- Community property states – community property laws are valid in nine states: Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Wisconsin, Washington. Alaska suggests community property law as an alternative to equitable distribution. In these states all the property and debts amassed all along the marriage is divided 50\50, not regarding any details or conditions of the marriage or divorce. It makes the divorce process faster, but may be really problematic for the divorcee who earns less or has to maintain the house and\or children.
- Equitable distribution – in the rest of the states the rule of the equitable distribution is applied. It means that all possible factors are counted to guarantee the fair assets and debts division. The following details are taking into account when applying the equitable distribution law: length of the marriage, age of divorcees, marriage living conditions, alimony or child support, contribution to the marriage, earning potential, health status, other relevant factors. This way the division process will be really long and complicated but as fair as possible.
All in all, it is up to you to pick out the appropriate way to deal with your assets and debts all along the divorce procedure. Yet, if you have the possibility to hold the negotiation with your partner without court intrusion, this is considered to be a preferable option for both partners. Filing the issue to the court, you lose your right and possibility to impact the benefits and personal life-conditions after divorce. While processing the agreement together with your partner and appropriate specialists you can have a straight impact on your future and win privileges for your life afterwards.