Determining Assets in a Divorce
Before someone files for divorce, it is important that they identify their assets, what they would like to do with them, and whether those assets should be divided in the divorce or kept separate and outside the divorce. As a first step, listing all of your property on a simple spreadsheet or document is perfect. The next thing they need to do when determining assets in a mesa divorce is categorize the property into community or separate property or a combination of the two, which might be quasi-community property.
When a couple accumulates property during their marriage by starting a business or buying a car or house, those assets are presumed to be community property with ownership divided between the two spouses. If one party brought property or debt into their marriage that they had before they got married, it is presumed to be separate property and is not subject to division upon divorce.
What is the importance of classifying properties?
Issues may arise in situations where the status of a property is somewhere in between separate and community. An asset usually becomes community property if both people’s names are on the title.
For instance, if one spouse owned a house before they got married, sold it during their marriage, and used the proceeds of the sale to purchase a new house with their spouse, it would not be clear whether the home is community or separate property upon a divorce. When you have property that you don’t know exactly how to classify, you should talk to an attorney before you file your divorce petition.
Another example is a spouse who has a business that they started before they were married. If they have been married for five years and the company has been in operation for 20 years, the business is separate property. However, the other spouse may have some ownership interest in the form of a community lien. If the business grew during the marriage based on the efforts of the community, the non-owning spouse may have an equitable interest in some of the growth. You will need an experienced attorney to help assert or defend against this claim.
For these reasons, it is so important to write down all of your assets and keep an organized record. Determining assets in a mesa marriage dissolution is crucial for correctly pleading in a divorce petition. Otherwise, you may need to file a motion to amend your petition to clarify whether the court has jurisdiction to make decisions over certain items of property. This issue can be extremely complicated, and it is a good idea reach out to an attorney for assistance.
Debt accrued within a marriage is also divided upon divorce. There are some exceptions, but most of the time, debt is divided between the parties. This can be complicated for the debtor. For example, if a couple has a joint credit card and incurs debt, both of them owe the outstanding debt as far as their bank is concerned, but a judge is going to order one of them to pay it.
If one party is ordered to pay the debt and does not do so, the bank may demand payment from the other spouse. However, the other party could have a potential claim against the first spouse for their failure to pay off the debt.
The general rule is that debt is community property subject to equal division. However, student loans are not usually divided between divorcing parties.
The individual who incurred student loans for their education is usually assigned the debt. The idea is that they get to keep their degree and education, so they should also keep their student loan debt.
The exception is when student loan debt is used to fund living expenses between the parties. When a couple’s living expenses are funded by student loans, they are no different than any other credit card debt and should be divided between both parties.
What is the impact of a pre-marital agreement?
A pre-marital agreement is a contract between two people and is entered into before they are married. A prenup lists all of a couple’s assets and income and specifies how those are going to be divided. It can also decide either party’s eligibility for spousal maintenance.
However, pre-marital contracts are relatively rare, and they are not always valid. Sometimes, there might be a prenup in place that can be challenged for one reason or another – either it was not fair or there was no fair disclosure. Having a pre-marital agreement is not a guarantee of any outcomes in a mesa divorce, but it does offer some predictability in determining asset division.
Post-marital contracts and the determination of assets
A post-marital contract between two parties is entered into after they are married and determines how their property would be divided and spousal maintenance might be allocated between them upon divorce. Postnuptial agreements can be difficult to obtain because they require actual consideration. There has to be a reason for a spouse to give something up because once they are married, any assets they incur thereafter are presumed to be community property.
Consideration means something of value must trade hands. For instance, one spouse would get one house while the other gets a different house. Another example would be if one party agrees not to take any spousal maintenance if the other agrees to work on the marriage. A post-marital contract is hard to get, so couples in mesa should definitely talk to our legal team for help with drafting an agreement which adequately determines all their assets.
Call an attorney for help with determining assets in a mesa divorce
Identifying and organizing your separate and community property in preparation for a divorce can be difficult. But you are not alone, and we can help. The lawyers at our firm would be familiar with the legal process associated with determining assets in a mesa divorce, and we are happy to share tips, tricks, and methods to help you. Give us a call or text so we can help plan your exit strategy.