Community property refers to property that is acquired after marriage and considered owned by both spouses. Nine states use this system.
Think Long-Term When you’re determining how you want to divide your property, you don’t just want to think about the current value. If you do, then you might not consider how much a home could be worth in the future or the losses you might suffer by accepting stock in lieu of other assets. You want to review all your marital assets and determine the best path toward future financial security. How Can You Make the Best Financial Choices During Your Divorce? It’s a smart idea to start by getting the current values of your assets. Things like stocks or retirement accounts might waiver, but you can get a general idea of their worth at the present time. Talk with Your Spouse After that, you should sit down and talk to your spouse. With assets like stocks, you might opt to cash out your portion immediately for the current value, or you could choose to accept them as they are and risk longer investments. Similarly, if you want your family home, you might accept the risk of depreciation in the hope of appreciation over time and decide not to sell it immediately. Know Your Assets to Make a Decision With complex assets, it can sometimes be better to liquidate them and split the profits. However, what you should do will depend on your knowledge about these assets and the potential for growth. Your attorney can talk to you more about complex assets and how you should handle them during your divorce.
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Accurate Valuations That may seem simple to accomplish, but if you don't know how much your assets are worth, splitting them can become problematic. For that reason, it's a good idea to work with someone who can accurately value your property and assets. Do We Need Just a Single Valuation of Our Property? Normally, each person involved in the divorce seeks their own property valuation. Those valuations are compared to one another to determine what valuation would be fairest. Some people add and divide the valuations to get an average, while others go with the lowest or highest valuations. Whatever you do, make it consistent. If you and your spouse get along, you may agree to have a single expert estimate the of value your property. In that case, the values assigned will be used in your case. Is It a Good Idea to Have Your Attorney Review the Valuation? Yes, because your attorney has seen similar work in the past and may catch unusual valuations if there are any. Additionally, they will be able to help you negotiate for the assets you want if you show them what your property is worth and how you'd like to split it. Visit Our Website Our website has more information on property valuation and why it's important to know what your property is worth before beginning negotiations during a divorce.
Dividing Debt: Student Loans It's a reality that divorce is emotionally and financially draining. You need to divide all your assets and debts, and that can include student loans. When Does Your Ex-Spouse have to Share in Paying Off Your Student Loans? Student loans don't become a joint debt in some cases, like when you have student loans before you were married. In most cases, that separate debt will remain your own following your divorce. However, if you went to school and have debt that originated during your marriage, it may be considered marital debt, and your spouse may be required to cover a portion of that debt. Knowing the Family Code California typically keeps loans separate, based on the Family Code Part 7, which states that loans incurred during marriage for training or education will not be included in community property, but they will be assigned to the person who took out those loans. There are exceptions to this rule, though, so it's a good idea to talk to your attorney before assuming that you'll have to pay it all on your own. Supporting Your Spouse Means You Could Get Reimbursed While California does require people to pay their own loans, if you support your spouse's education, you could still be entitled to reimbursement for those payments that you made since the benefit of that schooling or training will no longer help you in the future.
Agreements To Divide Up Debt Are Not Binding On Creditors Yes, you read that correctly. Agreements between you and your ex-spouse about how to divide up the debt is not binding on your creditors. If you and your ex-spouse come to an agreement to divide up the debt in your divorce, please know that your agreement is not binding on any creditors. If Your Ex-Spouse Files Bankruptcy You May Be Liable For The Unsecured Community Property Debt If are in the middle of a divorce and you get notice that your ex-spouse is filing bankruptcy, then please consult with your attorney as you may end up being liable for the unsecured debt that is community property. Your ex-spouse may be able to discharge the unsecured debt, however, for the same reasons as above, the creditors can still go after the spouse that did not file bankruptcy. A Chapter 7 Trustee Has The Power To Sell Real Property If you and your ex-spouse own a home together and there is sufficient equity then you must consult with a bankruptcy attorney to see if there is any chance that a Chapter 7 Trustee might list the home for sale even if only one of you files for Chapter 7 bankruptcy. It can be very complicated so it is important to consult with an attorney to protect your rights.
Child custody Fighting for custody of your children is never pleasant and never easy. If you need to engage in a custody dispute in court, it will benefit you, and your children, to have an experienced advocate on your side. Asset distribution Do you know what your community property rights are? You have put time, effort and money into this marriage. Make sure you obtain what is rightfully yours during a divorce.
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