One of the largest sources of distress for couples going through a divorce is the process of dividing up the property. Determining who should get what can be a lengthy and frustrating ordeal, even with the assistance of experienced divorce lawyers. How exactly the property is divided is determined by two factors: whether or not the couple can agree on how to divide the property, and the divorce laws of the state in which the couple resides.
Couples that have an especially bitter relationship, and can’t come to an amicable decision on their own, will need to have the court decide for them. The court’s decision is based on the state’s divorce laws. Those laws fall under two primary categories: Community Property, and Equitable Distribution.
Community Property: This is applicable in Alaska, Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington, Wisconsin, and the territory of Puerto Rico. This policy identifies property that was owned by both spouses as community property, which is divided equally. All other personal property is considered separate property and remains in the possession of the spouse who originally owned it.
Equitable Distribution: This is applicable in all states that community property isn’t, and divides property between the spouses equitably, but not equally. In other words, one spouse may retain possession of more than half the total value of all the property. All assets accumulated by the spouses are divided based on what the judge deems to be fair. This means that the result of dividing the property in one divorce can be very different from the result of another.
When property is divided, each spouse is awarded a percentage of the total value. When trying to split valuable possessions or certain items that one spouse wants to retain solely, asset substitution can be employed. This allows one spouse to essentially buy out the other spouse by trading away other property.
The issue of which spouse retains ownership of the house is frequently the most contentious one. Assuming that the couple owns the marital home together, dividing the property can have many results. If there are children in the equation, then it is likely that in order to preserve the child’s lifestyle, the spouse who was most responsible for child-raising will retain ownership of the home.
Property and assets aren’t the only things that are divided between spouses in a divorce. Debt is also factored in. Typically debts can be traced to an individual, and that individual is responsible for the debt’s repayment. Typically, any debt accrued by a spouse prior to the marriage is the sole responsibility of that spouse. In instances where debt is shared however, an agreement on who is responsible for the debt must be made, otherwise the court will decide. When assigning debt, considering each spouse’s financial situation and ability to pay is important since it is possible for one spouse’s credit to be affected by the other’s late payments or lack of payments.
Avoiding financial disputes is obviously in the best interest of both spouses, but given the emotionally difficult nature of getting a divorce, it may not be possible for both parties to remain civil and cooperate. A separation agreement can be made with the assistance of a mediator, typically a divorce attorney, in an effort to minimize the time and cost of determining a divorce settlement. Hiring a lawyer may seem like an expensive, and maybe even unnecessary step in the divorce process, but given the complexities of property division alone, it is likely the most expedient and cost efficient way to get a divorce.