Divorce Asset Distribution: 3 Warning Signs to Look Out For

Asset distribution is a major part of the divorce process. Unfortunately, it is not uncommon for one spouse to attempt to hide, transfer, or undervalue assets to gain an unfair advantage. Understanding the warning signs of deceptive behavior – and working with an experienced Charlotte divorce attorney – can help you protect your financial interests during a divorce.

Warning sign 01: Offering you one big asset

Just imagine the following: you are getting divorced, and your spouse offers you the house. Your spouse makes good money and has paid off the house’s mortgage. They offer to give you the house, to “make the divorce easier.”

On the surface, this may seem like a nice gesture. But, before you can make that judgment, there are a couple of questions you will want to ask your spouse:

• How does keeping the house affect my share of the remaining marital assets?
• Is the house really paid off, or are there outstanding liens or home-equity loans?
• Are there any debts tied to the property I’m not aware of?
• How will the ongoing property taxes be handled?
• How will maintenance be handled?
• Will refinancing be required, and if so, who is responsible for qualifying and completing it?

If you do not ask these questions, you may find that your spouse’s “generous gift” comes with very serious obligations, some of which you may not be able to address without further support. For example, if the house has been paid off and you receive it, in lieu of other assets, you may be forced to deal with expensive property taxes. These property taxes could be difficult, especially if you weren’t the primary earner.

The state of North Carolina uses equitable distribution. The court generally starts with a presumption of equal division of the net value of marital and divisible property unless an unequal division would be more equitable. Depending on the circumstances of the marriage, such as income differences, you may be entitled to more than just the house, including:

• A portion of their retirement assets and their 401K and/or pension, among other possibilities.
• Alimony is a separate claim from equitable distribution, though the issues are often negotiated together in a settlement.
• Other assets or items, including a car, furniture, and a large amount of your shared savings.

You may be entitled to more assets than you realize. A divorce attorney can help you identify and pursue these assets, which can make post-divorce life much easier, especially if you have limited financial resources.

Warning sign 02: Locked accounts/missing documentation

Here are two scenarios to keep in mind: you are trying to log in to the joint bank account, but the PIN no longer works. Alternatively, you ask your spouse for records of your shared savings account, but they refuse to give you these records and change the password so that you cannot access this information.

Both of these scenarios are major warning signs that your spouse is trying to give you far less than you are entitled to. In North Carolina, spouses may be required to disclose financial information in an equitable distribution case through discovery and, when required by the court or local rules, inventory affidavits.

For example, if your spouse refused to provide accurate bank statements, you may ask for less money than you are entitled to because you don’t know what is in those accounts. To regain access to locked accounts, a divorce attorney may be able to help by filing a motion compelling them to release the necessary access information.

If your spouse locks shared financial accounts or fails to provide accurate documentation, this willful discovery obstruction can result in sanctions, potentially including attorney’s fees.

Warning sign 03: Abnormal financial transactions

Picture this: you receive a monthly bank statement in the mail for your joint account. Upon opening, you discover there are many abnormal transactions. You’re unclear what these transactions were for or where this money actually went.

If something like the above happens, and asking your spouse results in no explanation – or an explanation that does not actually answer your question – there’s a chance your spouse may be hiding money.

North Carolina courts take a negative view of asset concealment during divorce proceedings, as it can affect equitable distribution decisions. This is because hiding money can deprive you of your fair share of the assets accumulated throughout your marriage.

You can learn where those financial transactions are going by consulting with a divorce attorney. A divorce attorney can file motions to compel disclosure of financial information. They can also hire investigators to perform forensic accounting, which can reveal hidden assets you may be entitled to receive.

What are the legal tools you should be aware of?

If you are getting divorced in the state of North Carolina, there are several legal tools you should be aware of:

• Forensic accounting: If your spouse is hiding assets, undervaluing their business, or obfuscating their income, forensic accounting can find those assets, determine the actual value of their business, and figure out what their actual income is.
• Legal negotiation: If you would like to obtain a settlement that encompasses alimony and some major assets, legal negotiation allows you and your spouse to negotiate a settlement that contains those things.
• Full disclosure: If you are not sure what assets your spouse has, your attorney can use inventory affidavits and discovery to require disclosure and seek court enforcement if your spouse refuses.
• Distributive awards: Equitable distribution may be accomplished through an in-kind distribution of marital property and/or a distributive award, which may be paid as a lump sum or in payments over time and may be secured by a lien.

A divorce attorney can help you employ these legal tools.

Speak with one of our Charlotte divorce attorneys today

At Epperson Law Group, PLLC, our attorneys are here to help you during your divorce. Contact us today to speak with one of our experienced Charlotte divorce attorneys.