The Legal and Practical Considerations Involved in Dividing Property and Assets During a Divorce
Divorce is stressful enough even before determining what to do when dividing assets and property. Disputes over property division are common and often lead to litigation. However, lawsuits are costly and time-consuming. You also give up control over the outcome of your case if you let a judge decide for you.
You must consider the implications of splitting specific assets and how that might affect your financial future. Knowing your rights and the value of your property can help during settlement talks. Adequate preparation is crucial to protect your interests.
Here, you will find tips on handling property division with your spouse during divorce negotiations.
Strategies for Approaching Property Division in a Divorce
Walking away from the marriage without the property you are entitled to can cause significant financial strain. You might depend on certain assets to afford your monthly bills. You should make a list of every asset you and your spouse own before deciding how to split everything.
When negotiating the division of assets, it’s helpful to know whether they are marital or separate property. Marital property is property acquired during the marriage. Marital property is jointly owned by the couple. Separate property is property acquired before marriage or by inheritance or gift.
Virginia is an equitable distribution state. That means the courts divide marital property between a divorcing couple according to what’s equitable and fair. That doesn’t necessarily mean a 50/50 split. The judge determines what’s considered marital property and distributes it based on multiple factors, including each spouse’s income and the duration of the marriage.
Marital assets that will be subject to equitable distribution during divorce include:
- Real estate
- Motor vehicles
- Retirement accounts
- Brokerage accounts
- Business interests
- Valuable collectibles
- Household items
- Personal property
- Bank accounts
Determine the value of each asset, so you know what everything is worth. That will simplify dividing property fairly or trading one asset for another.
Treating your spouse with respect is crucial despite how you might feel about them. Avoid letting your anger, resentment, and other feelings cloud your judgment. The purpose of negotiating while dividing property and assets is to reach a mutually beneficial arrangement. If you mistreat your spouse, they’ll likely be unwilling to compromise.
You should find a way to compromise to resolve your disputes without involving a judge. Mediation is helpful under certain circumstances. A mediator might be able to provide practical solutions to solve your issues and settle the case outside of court.
Dividing Your Homes and Vehicles
You and your spouse might have a primary residence, land, rental property, and multiple vehicles. You can’t split physical items like those in half. However, you can determine how to divide everything fairly. Negotiate with your spouse to avoid the court deciding whether you can keep the marital home or car you drive. You might reach an agreement that benefits both of you.
For example, selling your primary residence and splitting the proceeds might make the most sense. Or whoever has primary custody of your children could stay in the home to avoid uprooting your children’s lives. In exchange, the other parent could receive another asset or a larger share of the bank account.
Splitting Businesses and Retirement Accounts
Disagreements over how to divide retirement accounts are common in divorces. Many people believe they should keep the money saved in their 401(k), IRA, or another plan because they worked hard for it. However, equitable distribution also applies to retirement accounts. That means the court can order part of the funds to be given to your spouse.
Resolving disputes over any retirement plans you and your spouse have should be simple. If you don’t want to take your case to court, agree to keep your own accounts instead of dividing them. If only one of you has a retirement account, you might consider letting that person leave the marriage with it as long as the other spouse can take a savings account or another asset equal in value.
Businesses can be challenging to handle while dividing property and assets especially if it’s a family-owned business. You must consider the company’s value. There are multiple options for splitting it with your spouse. Common solutions include:
- Buyout – A buyout agreement allows one spouse to buy the other party’s percentage of ownership. That allows one spouse to keep running the business while the other receives financial compensation.
- Sell – If you can’t run the business together and neither of you wants to handle it alone, selling and splitting the proceeds is a good option.
- Continue to co-own – If you and your spouse can get along well enough to continue running the business, you could continue operations as usual.
Contact a Dedicated Virginia Beach Divorce Lawyer Today
The decisions you make during property division negotiations will impact your finances and future. You must consider the consequences of a settlement agreement and whether it will benefit you in the long run.
Hardt Law, P.L.L.C., will protect your rights and interests while representing you during divorce proceedings. Call us at (757) 962-5588 or contact us online for a confidential consultation if you’re going through a divorce and need legal representation.
