Preparation and perspective can go a long way when it comes to every aspect of divorce, and that is especially true when it comes to up a divvying marriage’s worth of assets (and debts).
The property division aspect of divorce can create a very hostile situation that is not very conducive to amicably going your separate ways. However, that doesn’t necessarily need to be the case if both parties follow the procedures set in place without getting hung up on the little things.
Here are a few quick property division tips to keep in mind when you reach the “who-gets-what” aspect of the divorce process.
Brush up on your state’s property division laws
While the majority of states follow equitable distribution guidelines — meaning the court will look at a variety of factors to determine a “fair and equitable” division, not necessarily 50/50 — several states follow community property laws, which presume an equal split.
Knowing how your state will divide property can give you a good idea what you face going into negotiations.
Understand the differences between separate and marital property
Many people going through divorce get hung up on how they feel property should be viewed as opposed to how the state actually views property. Generally speaking, you can assume assets acquired during the marriage will be up for division (this includes retirement and investment accounts, pensions, property, vehicles, etc.).
You need to realize that just because you were the one who worked for 20 years building up a 401K does not mean it is separate from the marital estate.
Property settlements are typically final
While aspects such as alimony, child support, custody and visitation can all be modified to account for changing circumstances further down the road, property settlements usually cannot be changed post-decree.
While many guys often get frustrated and decide to “just give her everything” to get the divorce over with, this move can come back to haunt you once you are finally thinking straight.
Be honest with your financial declaration
Before you can even begin the negotiation process, there needs to be a clear picture of the value for the entire marital estate. It is a tedious process to gather together documentation for every bit of property that needs to be divided, but accuracy from both sides will ensure that discussions are made in good faith.
Failing to report significant assets can derail the entire process and raises trust issues that complicate future negotiations and reflect poorly in the judge’s eyes.
On that note, don’t try to hide assets
While you may want to stick it to your soon-to-be ex, attempting to hide property will more than likely land you in trouble and is not worth the risk. As sneaky as you may think you are being, attorneys are well-trained in uncovering attempts to fraudulently secret away wealth during the discovery process.
Being caught can have potentially severe consequences, including being punished financially in respect to your share of the marital estate, as well as severely damaging your credibility for the remainder of the proceedings.
Utilize both attorneys and negotiation professionals
A local family law attorney will know how your jurisdiction handles the division of property, meaning they will be able to explain the risk/reward of fighting for various assets and whether litigation may be beneficial or not.
Additionally, good mediators are able to devise creative solutions that appeal to both sides and may be able to bridge gaps in even the most contentious divorce.
Don’t get hung up on the little stuff
It happens more often than you might think, but couples going through a contentious divorce may spend thousands — or even tens of thousands of dollars — bickering over assets that could be replaced for a few hundred dollars at IKEA.
Fighting over property out of principle or spite will do nothing but drive up the total cost of your divorce, so you need to try to keep a level head and clear perspective on your goals.
Similarly, pets are considered property
This is a tricky area when it comes to divorce, as pets are technically considered property by law. However, the family dog will generally have more value to both sides than a living room set, which has led to obscene amounts of money spent fighting over poor little Lucky.
While it can be difficult to do, both sides need to determine which party is best suited to care for the pet’s needs and one spouse will need to let go. Even though you clearly cannot replace your beloved pup, realize that there are plenty of lonely pets at your local shelter dying to find a home.
Mortgages can create headaches
One spouse being awarded the marital home with the other receiving other assets to offset the value is a fairly common arrangement after a divorce. However, a mortgage typically has both spouse’s names on the loan, and refinancing post-divorce can be a challenge.
Banks are often hesitant to refinance on a single income, meaning despite what the divorce decree says, both parties can still be liable for the payments.
Consider long-term financial needs and consequences
It’s easy to get caught up in the mindset of wanting to come out with the “biggest” settlement; however, you need take into consideration your current financial situation and what you will need in the future.
If you are awarded the home, will you be able to handle the mortgage payments and upkeep? How close are you to retirement? Will you be paying alimony or child support? All of these things can have major ramifications down the line, and short-sightedness can leave you in a bad situation.
While property division can be an area of divorce where couples get hung up and major contentious issues can arise, keeping things in perspective and planning ahead can go a long way in ensuring your divorce does not drag out unnecessarily and end up costing far more than the value of the appliances you are fighting over.