Three Things to Know About Property Division
Reaching an equitable property division can be a difficult and stressful process. What may seem like a simple 50/50 split may turn out to be difficult to implement. Here are three things to know when thinking about property division:
- Separate Property – if you’re going through a divorce, you’re probably feeling like you aren’t interested in being generous with your soon to be ex-spouse as far as property is concerned. Depending on how and when your property was acquired you may be able to keep some of your property separate. This means that it would be off the table when it comes time to divide property between you and your spouse. Barring certain circumstances, property acquired before your marriage is your separate property, as is property acquired via inheritance. There are also other circumstances that can give rise to separate property. Be sure to talk with your divorce attorney about the details of your property, regardless of whether it’s a home, retirement account, or otherwise.
- Retirement Funds – while it’s good to walk away from a divorce with money for retirement, you need to make sure that this comports with your goals for the future. Money in your retirement account cannot be accessed without penalty until you are 59 1/2. If you’re looking to purchase a house after your divorce, or even a few years down the line, you’ll need to walk away from your divorce with cash for a down payment. For some people, the opposite is true. Your spouse may be the one that accumulated all of the retirement funds, and you may need a large share of that to maintain your standard of living now or in the future. Whatever the case, be sure to discuss your goals with your divorce attorney so you can make the right decision when it comes time to divide retirement funds.
- Refinance – generally, both spouses are on a home loan. As a result, when one party keeps the house, that party must refinance the home loan to remove the other party’s name. This can cause problems, as the party that wants to stay in the house may not qualify for the loan. For instance, you may be a stay at home Mom with young children, and you would like to stay in your house. The problem is, you probably don’t have a sufficient income to refinance, as you have been out of the workforce taking care of your children. A good divorce attorney will know plenty of mortgage bankers and lenders to give you the best shot to refinance and stay in your home.
Don’t be shy about having a blunt conversation with your divorce lawyer about your goals with respect to your property division. Contact me for a free consultation to talk about how to divide your property.