Nobody enjoys getting a divorce. But when the going gets tough, knowing how property division works can make everything much easier.
The simple truth is that most people have no clue what their rights are when it comes to splitting assets. And that ignorance can cost them dearly.
On the bright side:
Armed with the right knowledge and legal representation, anyone can protect everything they've worked so hard to build. Property division doesn't have to be a battle.
In this guide, we'll take you through everything you need to know about getting divorce legal services to protect your rights in this process:
- What Is Property Division in Divorce?
- Why Property Division Matters So Much
- The Two Types of Property Distribution
- How Courts Decide Who Gets What
- Protecting Your Rights During the Process
Jump to:
What Is Property Division in Divorce?
Property division is a legal process that takes place during divorce.
The process of property division in divorce means that all of the assets and debts acquired during marriage are divided between the spouses.
This may include the marital home, retirement accounts, credit card debt, vehicles and more. Basically, if it was acquired during marriage, it is probably on the table for division.
But here's the thing…
Not all property is treated equally. There are specific rules as to what property is eligible for division during a divorce, and what isn't. These rules vary depending on where someone lives and how the property was acquired.
So if you find yourself in such a situation, the first thing to do is to consult a virginia divorce lawyer and get some advice on how divorce legal services can help you in this situation. The experience and knowledge of professionals make an enormous difference in the outcomes of cases.
Did you know that approximately 80% of all divorce settlements involve property division with a detailed and challenging process of valuation and distribution? That's a lot of numbers.
This fact also demonstrates how critical this property division in divorce aspect really is.
Why Property Division Matters So Much
Before we go any further, it's essential to understand why it's so critical to know about the details.
Think about it…
All the money you spent on your house. Or that pension plan. Or even that fancy sofa you got last month.
It was all money taken out of your earnings. And guess what? When your marriage ends, all that has to go somewhere.
Mess up the property division, and you can seriously affect your long-term financial standing. It can significantly impact such important things as:
- Financial stability for years to come
- Retirement planning and security
- Living arrangements and lifestyle
- Future earning potential
As you can see, the stakes are really high. And that's the reason why taking the time to know what you are dealing with is so critical. Knowledge is power in these situations, and nobody should go there unprepared.
The Two Types of Property Distribution
It's important to note first of all that not all states deal with property division in divorce the same way.
There are two main approaches used by courts throughout the country. And before we deal with these two types, we need to learn what they have in common.
In both property distribution types, a process of property division in divorce goes with an overall set of rules which remains the same for all cases. They establish the following:
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- All marital property gets a fair valuation
- Non-marital property is excluded from the distribution process
- The two spouses are presumed to contribute equally to the acquired property
And now we can proceed with the two main types of property division in divorce.
Community Property States
This type of property division in divorce is established in certain states and means that the marital property is divided between two spouses in almost equal shares.
This is the court's starting position. But only as to the marital property. Separate property is considered as property of one spouse, and it is not subject to property division in divorce.
This type is the only one that has something in common with community property rights, a property system which doesn't exist in the US.
Equitable Distribution States
This type of property distribution is used in a majority of states in the US. According to this, the marital property is distributed between the spouses in an equal or a proportionate share.
The term "equitable" may mislead. "Equitable" does not mean equal in this sense. The rules of equitable distribution mean that the shares can vary based on the decisions made by the court or during negotiations.
The difference between this type of property division in divorce and community property states is only in a concept of fairness.
Courts used the same concepts as a factor in equitable distribution. It also has to be taken into account that 85% of all divorce settlements are reached outside of the court.
How Courts Decide Who Gets What
The question is, what do courts take into account when it comes to property division in divorce?
Here is the deal. All in all, courts consider a number of factors as a part of property division in divorce and they are as follows:
- Length of marriage
- The income of both parties and the ability to earn money
- Contributions made to the marriage (homemaking and education included)
- The age and the health conditions of both parties
- Children custody arrangements
- Prenuptial agreements, if they exist
Protecting Your Rights During the Process
Now you probably know the answer to the question "How to protect assets during a divorce?"
The best solution is to start with organization and documentation. As the saying goes, documentation is the key.
In this case, all necessary means are gathering financial records.
All necessary financial records include bank statements, tax returns, investment accounts, property deeds, and everything else you can name. The more full the picture, the more you can count on.
Knowing what's marital and what's separate is the next step.
Separate property typically includes anything owned before marriage, inheritances, and gifts. If you keep these assets separate throughout the marriage, it's easier to protect them.
Get professional valuations if necessary.
Some assets are more difficult to value than others. Businesses, real estate, and retirement accounts, for example. It often takes professional appraisals to determine their real value.
Don't forget about tax implications. Not all assets are treated the same for tax purposes.
A retirement account worth $100 today might be worth much less after taxes. Wise planning takes this into account.
Last but not least, don't hide anything.
Hiding assets during divorce is illegal and will only result in severe penalties. The court does not take this seriously.
Common Mistakes to Avoid
Some people can make many mistakes during property division. It is always helpful to learn from others' mistakes.
Don't rush the process is the first piece of advice.
Divorce is emotional. But making rash decisions about significant assets is a terrible idea. Cool your head, and your financial situation will be better.
Don't forget about the debts.
Assets are not the only things to divide. Debts are divided too. Credit cards, mortgages, and loans are all part of the picture.
Don't let hidden assets be hidden. Some spouses attempt to hide money or undervalue their property.
This is confidential work by professionals. The legal team knows how to reveal this.
Don't forget to think long-term. When property division in divorce is in the air, people think of what is best for them in the short term.
We hope you find this comprehensive guide on property division in divorce and its implications useful and that you are ready to put the critical knowledge to good use.
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