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Divorce and Separation: Splitting assets the right way

 28th October 2016

September was the month of high profile divorces. Brangelina, Zoe Ball & DJ Fatboy Slim and Naomi Watts & Liev Schrieber. Never a straightforward process, (not even for celebrities) divorces divide families, cause animosity and can be devastatingly expensive.

brangelina

However, if you and your former partner can sweep emotions to one side, a workable outcome can often be agreed without the expensive necessity of going through the courts.

Many difficult decisions have to be made if both parties are to make the transition as smooth and civil as possible. These decisions are difficult enough for those who are parting on good terms. The reality of most divorces is that the emotional impact of the whole process (and whatever has led up to it) can make rational, even-handed decision-making even more difficult.

In this guide, we take you through the difficult process of splitting assets.

Compromise and calm needed

The ability to compromise from the beginning can reduce conflict and ensure both you and your partner can part on satisfactory terms. The most logical method is to go through everything you both own and compile a list of assets. Although fine in theory the reality is that this is highly likely to bring unhelpful emotions to the fore.

Aside from their knowledge of the law, there are good reasons why people use third party counsellors and legal intermediaries to help negotiate this process.

According to Esther Shaw of the Daily Express, “Irrespective of your financial situation, it is well worth seeking advice from both financial and legal professionals to get the best guidance through the divorce.” And nowhere is this more evident than in how the family home is dealt with.

Divorce hardly ever involves an ‘ideal world’ scenario. Simply selling up, dividing any equity and going your separate ways is in itself a long winded and messy business. But if one party wants to remain in the home, and if there are children involved, things can quickly get even more complicated.

family silhoutte

Prioritise the children

It is axiomatic that both parents should focus on the welfare of any young children and make certain they are in a stable home environment before any property disputes are addressed. This is the rationale that any court will adopt, so it makes sense to recognise it as early as possible. Likewise it should be acknowledged that both parents will be under an obligation to provide a suitable ‘family home’ as a result of any settlement. You can’t divorce your kids.

Marital assets

It is important to reconise that any divorce settlement will consider the family home a ‘marital asset’. It doesn’t ordinarily matter whose name the deeds are held in (the same logic applies to pensions and savings accounts incidentally). Just because the house is in one party’s name does not mean that they have absolute rights to it. At the same time, it is vital to keep any mortgage lender informed as to your situation. They can be surprisingly helpful in a crisis - but only if you talk to them.

Buy out options

A common practice is for one party to buy out the other’s share. This will depend on their ability to either provide the funds to do this or be able to secure and service an appropriate mortgage.

If a straightforward buy out is not possible it is not uncommon for one party to continue living in the home up until the point where any children reach maturity. At that point the house can be sold and divided between the two parties under the terms of what is known as a Mesher order (England and Wales only). A similar arrangement can defer a sale until the resident party either remarries or dies; this is known as a

Martin order.

A more involved arrangement involves one party staying in the family home whilst their partner takes a stake in the property as - in effect - a sleeping partner. Arrangements for the timing of any sale and subsequent disbursement of funds inevitably will call for professional advice.

The grown up way to part terms

During separation, it can be difficult to agree and make arrangements that suit all concerned. But with a degree of compromise and common-sensical decision-making, some sort of resolution can usually be achieved. The use of counsellors as a precursor to any formal legal steps can be a significant help in reducing both the emotional and the economic stress of a process that is by definition anything but straightforward.

Open Property Group’s role

Ending a relationship is always hard and in the case of divorce, a long drawn out process can be even more difficult, making the chances of an amicable split less likely. If you want to sell your house fast you can approach a company like Open Property Group who will buy your property for cash, at up to 85% of the market value and in some cases within 7 days.

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