Divorce and Your Assets

Protecting Marital Assets

After the formal filing of the divorce “Complaint,” you may pursue restraining orders to prohibit your spouse from taking actions that may dissipate the marital assets.

The Family Home

The BIG Question: Who Gets the House?

In most divorces, the family home is the largest asset that will be divided in the litigation.

In addition to the purely financial considerations, many people are emotionally attached to their home. Some people will put keeping the house as the most important priority in securing a proper environment for their children. For parents with school-age children the idea of turning their lives upside down and taking them away from their friends can blind them to certain realities.

The most important step that you can take to protect yourself is to talk with your attorney.

Factors to Consider:

Can you afford to keep the house?

Your attorney should be someone you trust to realistically assess whether keeping your home is a good financial decision. You should also talk about what price you would be willing to pay in the divorce negotiation to keep the house. If you give up everything else in order to keep the home, and then find that you can’t cover the mortgage, property taxes, and maintenance, you may end up in serious financial trouble. The divorce court will look at your ability to pay for the home along with your spending habits during the pendency of the divorce to determine whether it will order the home sold or awarded to you.

Can you work it out with your spouse?

If you and your ex-spouse can set aside your differences enough to negotiate the home’s division, all sides (including the children) will benefit. Again, frank and open discussions with your attorney will provide benefits. If your attorney knows how important keeping the home is to you, they can negotiate a palatable solution. It is always better to negotiate a good agreement rather than let the court decide these important issues for you. Another thing you and your attorney can do is PREPARE. If you want to keep the house, and intend to refinance the house into your name only, strong consideration should be given to doing the refinance while the divorce is pending. If you can’t qualify for a loan while the divorce is pending, you may be unlikely to qualify for a loan afterwards either. In the meantime, you can’t qualify to buy a new house because your name is still on the old mortgage.

Do you understand how the court will approach the division of property?

Under Ohio law, it does not matter if your spouse is more “at fault” in causing the divorce. The court will not seek to punish a spouse, but instead will seek to divide the property according to law. It also does not matter if the home was previously owned or titled to one of the parties. In Ohio, just because the house is titled in one parties’ name or the others, only, does not mean that the house is separate property under Ohio law. Just because one of the parties owned the house prior to marriage, does not mean that the house is STILL separate property. It may have become transmuted into marital property under Ohio law.

Who do you want to sell the house?

It is also preferable to discuss the prospect of selling the home with your attorney. It may be in your financial interest to seek ownership of the home with an eye toward selling it. You may not trust your ex-spouse to cooperate with a realtor or be diligent in keeping up the property. You may also feel powerless if your ex-spouse is able to nix any deal by being inflexible on the sale price or other minor contract issues. You may also think that if you are awarded the home and make some reasonable repairs the value of the home will increase significantly.

Marital Property and Separate Property

Think That Was a Gift? - In Divorce, Not Unless it’s in Writing

Prior to divorce couples often give each other gifts for various occasions and celebrations, or for no reason at all, but what happens to all those gifts when the couple splits-up is not so understood. In Ohio, as a general rule, any property a couple acquires during the course of the marriage, whether jointly or individually, becomes marital property. The only exceptions include inherited property and property designated as individual property or as a gift in writing.

For example, if your husband or wife gives you a boat for your anniversary, you cannot say it is your boat when you divorce. This also means that your spouse cannot claim that the boat is theirs just because they purchased it. In a court proceeding, absent a writing, the judge will not rely only on a claiming party’s word alone.

What Constitutes Marital or Separate Property in Ohio?

Marital Property

In Ohio, assets acquired during the marriage are considered marital property. This is defined as the period between the date of marriage until a final hearing of legal separation or divorce. This includes:

All real and personal property currently owned by either or both spouses. This can include retirement benefits.
All interest that either or both spouses have in real estate or personal property.
All income and appreciation on separate property pertaining to the other spouse's labor, monetary, or in-kind contribution.

Separate Property

An inheritance by one spouse by bequest, devise, or descent during the course of the marriage;
Any real or personal property that was acquired by one spouse prior to the date of the marriage;
Passive income and appreciation acquired from separate property by one spouse during the marriage;
Any real or personal property or interests in real or personal property acquired by one spouse after a decree of legal separation;
Any real or personal property or interest in real or personal property that is excluded by a valid antenuptial agreement;
Compensation to a spouse for the spouse’s personal injury, except for loss of marital earnings and compensation for expenses paid from marital assets;
Any gift of any real or personal property or of an interest in real or personal property that is made after the date of marriage and that is proven by clear and convincing evidence to have been given to only one spouse.

Securing Your Finances In Divorce

Many times bankruptcy and family law go together.

Sometimes it is because one person can no longer afford the expenses that two people used to contribute to. Other times it is that one spouse has taken on a significant amount of debt in the divorce settlement. Bankruptcy offers a solution to these problems. When a person files bankruptcy after a divorce is finalized, they can discharge most of the debt they have accumulated in the divorce. Barring an agreement between the parties in a divorce decree that one party will not discharge their debts in bankruptcy, a person can file for bankruptcy and eliminate all dischargeable debts. These debts typically include credit card bills that the couple shared that one spouse took in the bankruptcy. If one spouse took possession of real estate but can no longer afford the payments with just one income, they can file for bankruptcy protection to avoid liability of any deficiency owed.

Alimony & Spousal Report

One kind of debt that is not dischargeable that comes up in family law situations is alimony or spousal support. Both alimony and spousal support are specifically listed as non-dischargeable by the bankruptcy code, so declaring bankruptcy on these debts will not discharge them. However, many times bankruptcy is the best option for someone who has accumulated a massive amount of debt after going through a divorce.

Contact David - Our Bankruptcy Attorney

There for you through the entire process.

I gives free consultations, guides you through your decisions, and I'm available for continued support after the divorce is over.

When You're Ready To Let Go