How Assets and Liabilities of Each Spouse are Determined in a Divorce
Many divorcing couples make the mistake of dividing their assets and liabilities without fully understanding what they own or owe. This poses problems after the divorce when it becomes apparent that one side ended up with greater than expected bills or an inequitable division of property. Spouses need to be vigilant from the onset of divorce proceedings. Listing assets and liabilities is one of the first things to do when initiating a divorce. A Houston divorce attorney can help you ensure that you fully and fairly value you and your spouse’s assets and liabilities during a divorce.
Valuing Assets and Liabilities for a Divorce
The problem with many assets and liabilities is determining how to value them. The following are some of the areas to which to pay close attention:
- Houses. A house is usually the biggest asset involved in a marriage. Financing a house often involves both spouses. They own the house jointly, and they are both on the mortgage. Divorcing couples can agree to continue to own the house jointly and make payments on it, or they can agree to give the house to one spouse and remove the other from the deed and mortgage. In the latter case, if you will be the one removing your name from the contracts, it is wise to consult an attorney and ensure that you correctly perform this step. You do not want to find out down the line that you legally owe the bank house payments.
- Household items. These items can be easy for a couple to value and divide, but that is not always the case. It is best if the two sides can reach an agreement as to who gets what household items. In less than cordial cases, however, spouses can drag on a divorce for months arguing over who should get the toaster. There are more important issues in a divorce so if the couple can prioritize those areas and comprise on household items, it is ideal.
- Retirement Plans. Valuing and dividing these can be quite complicated. For something like a pension plan that will not begin making payouts until years down the line, it can be difficult to agree on its present value. Additionally, special legal forms and procedures are required to change certain retirement plans for them to be able to pay someone other than the owner. A Houston property division lawyer can help you with this area of family law.
- Family Businesses. Having to sell and split the proceeds from the sale of a family business is not usually the best option. It ends the business and can put many people out of work. It can be difficult valuing a family business, particularly if both spouses were involved in it. Deciding what is fair to do with the business is not an easy decision and it will depend on appraisals and negotiations between the two spouses.
- Vehicles. Valuing your cars is a somewhat straightforward process. You can verify the vehicle’s value with books available at the library, resources on the internet, or appraisals from used car dealers. Valuation can be trickier if you lease the car. With some lease contracts, you may not own any value at all in the car. For other vehicles, valuation may be more difficult and require more research.
Valuing both you and your spouse’s assets and liabilities is vital if you hope to arrive at a fair division of property during a divorce. Contact a Houston property division attorney at John K. Grubb & Associates, PC to learn how what steps you can take to properly determine and value you and your spouse’s assets and liabilities in a divorce.