During a divorce, determining the division of assets and property is an important step that may cause much friction. Handling this aspect of the divorce with a structured plan is important for making it as seamless as possible.
In many cases, there are many areas of property division the two parties need to account for and divide. Putting in place a strategic plan makes it more likely there will be no confusion going forward and a more amicable parting may be possible.
Determine the value of property
To effectively divide the property between the two parties, it is important to determine the value of each piece of property. The common evaluation method is the fair market value, which means the current value of an item and not the original purchase price. An appraiser or the ex-spouses may determine the current value.
Divide the debts
Property and assets are not the only vital financial division to consider during a divorce. Debts are another factor that one may address in a spousal agreement. Some common debts include joint credit card bills, car payments, mortgages, alimony and child support. Ensuring these are fairly distributed lessons the chance of contentious dispute between both parties.
Create a written agreement
Drafting a spousal or property settlement agreement is an important step when dividing property and debt during a divorce. This agreement details the decisions made for how the ex-spouses divide the finances after finalizing the divorce. Preparing a written document that specifies who keeps certain assets after the divorce helps lessen complications during the proceedings.
Settlement agreement breach
Both parties need to fulfill their duties in the contract. Examples of how one might breach this type of contract include withholding property or not paying debts. If either ex-spouse breaches the settlement contract one can file a motion with the court and it may lead to a contempt of court sentence, which may include paying a fine or jail time.