Marriage does not work for many people. Sometimes, a marriage is short and bitter, or long and loving, or everything in between; however, for some, divorce is necessary. It does not make it any easier, unfortunately. A divorce is often a stressful and tedious process, often becoming emotionally draining, as well as financially. What can make it more difficult is the division of assets, including property. Too many people do not sign premarital agreements before marriage or postmarital agreements after they’re married. These agreements can help to save a lot of stress should you ever get divorced.
One couple’s property division nightmare
In an article by The Moneyist on Marketwatch.com, a woman – self-named “Second Wife” –describes her and her husband’s woes concerning the property division of his previous marriage. While the details are vague at times, she offers the picture that her husband and his ex-wife had bought a house, where the ex-wife’s name was on both the deed and the loan, but the husband’s name was only on the loan but not the deed. The woman asks what can be done in order to get his name on the deed and the ex-wife’s name off.
MarketWatch’s financial expert, Quentin Fottrell, has some unfortunate news for Second Wife. He informs her that if Husband and Ex-Wife bought the house before they were married, then it is likely that the house would be considered the wife’s property. Addressing the Second Wife, Quentin states:
If your husband’s name is on the mortgage but not on the deed of the property and the house was bought prior to their marriage, he is technically a co-signer on the mortgage, but not a co-owner of the property. It’s a bad place to be in. Your husband — and everyone else — should always read documents before signing.
This unfortunate story is a good lesson about premarital agreements, and understanding what you are getting into when you are getting married.
How is property categorized in North Carolina?
In order to understand premarital and postmarital agreements, we need to understand how property is classified. In North Carolina, there are three categories for property:
- Separate property. Separate property is the property you own before entering a marriage, and includes gifts given solely to you. If you own a car before you get married, for example, that car would be considered your separate property after the marriage.
- Marital property. Marital property is considered to be anything bought or acquired or earned after the marriage. This includes income earned, property bought, and retirement accounts either of you started after the marriage and before the separation.
- Divisible property. There’s a period of time between your separation and when the property is finally distributed. Any assets or debts accrued in this time period is known as divisible property. “Any increase or decrease in value of marital property between those dates is subject to division, as is any interest or income received on marital property and similar assets.”
What are premarital and postmarital agreements?
When you are getting married and even after you are married, there are ways in which you can ensure your property remains yours in the event of a divorce. A premarital agreement is an agreement that you sign with your partner before you are married. This agreement creates an inventory of the things each person owns (assets) and what they owe (debts). This becomes a list of what they are bringing into the marriage as separate property. Along with this list, they decide on how to handle property and debt division should they ever divorce, and how to handle spousal support.
A postmarital agreement is very similar to a premarital agreement, but it happens after the marriage. Married couples often choose to do this if they come to have considerable assets during the marriage. Consider, a couple wins the lottery or they are gifted a substantial inheritance. It would be a good idea to make sure that those new assets are secured properly. It may seem morbid to consider the possibility of a divorce while you are still happily married, but if you never divorce there is no problem, and it is there if you do ever divorce.
These sorts of agreements are not just for the wealthy; they are for everyone. Those couples with even modest incomes and assets would be wise to sign a premarital or postmarital agreement, as should they ever divorce, the process will be a lot smoother and far less stressful and costly than had you not had the agreement in the first place.
How does division of property work in North Carolina?
Depending on whether you have signed pre- or postmarital agreements, the complexity of your divorce can vary greatly. The amount of assets and property could also lengthen and complicate the division process. No matter the case, our experienced attorneys can help.
There are four main steps in the division of property:
- Identification of property. First, the property must be identified. Each asset must be documented, no matter which party owns it.
- Classification of property. Next, the court determines which property is marital, separate, and divisible.
- Valuation of property. In order to determine how the property can be equally divided, the court needs to take the value of the marital and divisible property. With each spouse’s attorney present, they both will provide evidence illustrating the fair market value of the property and assets.
- Division of property. Finally, the court will divide the assets and property between the spouses equitably and fairly, although this may not result in a 50/50 split. Either party has the right to argue against the final division, which can be done with the help of their Charlotte divorce attorney.
Not every divorce is full of conflict and strife. If your divorce is an amicable one, both parties can sit down with their attorneys and devise a fair and understandable property division agreement. However, sometimes that is not possible, and in those cases, the court can intervene and make a decision for the couple. In all cases, our Charlotte divorce attorneys will be there to protect what is most valuable to you, and ensure what is best for your family.
If you are going through a divorce, and you are worried about how your assets and property are going to be divided, the family law attorneys at Epperson Law Group, PLLC will work with you to make sure that your personal property remains your own, and that all the assets between you and your partner are split equally. To reserve a consultation with one of our lawyers in Charlotte, Concord, Boone, and Weddington, please call 704-321-0031 or fill out our contact form.