DIVISION OF ASSETS, DEBT & PROPERTY IN A DIVORCE
Divorce Attorney in Maryland Explains Division of Assets, Debt & Property in a Divorce
According to Maryland state law, the division of marital property in the case of divorce must be equitable, meaning it must be fair, not necessarily equal. Some couples are able to come to an agreement about how everything should be divided without legal intervention, and are able to submit an agreement for court approval. Others need the help of a divorce attorney in Maryland or mediators to assist in the negotiation of a settlement.
Marital vs Separate Property
The very first step when deciding how to split up assets and property is to determine what was shared and what belonged to each respective party. Prenuptial agreements can lay this out quite clearly, making this step much easier. For couples without an agreement, marital property includes all assets and debts accumulated during the marriage. The following is considered separate property:
- Property that one spouse owned before the marriage
- Property that a spouse acquired during the marriage through inheritance or as a gift
- Property that one spouse can show began as separate property
Any real property that the couple has shared is always marital property, unless there was a valid agreement established that states otherwise.
Commingling property is property that is in some part marital and in some part separate. This would include a property that one spouse owned before the marriage but towards which both spouses made payments during the marriage. When two individuals share a bank account, the funds can only be considered separate if it is possible to trace the separate funds through financial records.
If shared funds are used to pay the mortgage or expenses relating to a separately owned asset that has appreciated in value, the court will apply the “source of funds” rule. This rule determines the value of the separate and marital property in proportion to the contributions made by each spouse.
Determining separate and joint allocations of funds can be extremely complicated and is much easier with the help of a divorce attorney in Maryland. If spouses aren’t able to decide who the true owner of each asset is, the court will and the results may seem unfair.
Assessing Property Value
After it has been determined who is the true owner of each asset, it is time to determine the value of these assets. This can become complicated as all assets have been owned and changed since their initial valuation. Using a professional appraiser can be very helpful. Some financial assets, such as retirement funds, can be exceedingly difficult to evaluate. In these cases, a financial professional such as a CPA or actuary may be necessary in addition to a divorce attorney in Maryland.
Spouses may split up the property among themselves, perhaps with an equalizing payment to even things out if one spouse gets significantly more assets than the other. Another method is to sell shared property as split the proceeds. In some divorces, some couples agree to continue owning property together. This may not be possible depending on the state of the relationship.
If the situation ends up in court, Maryland law allows the court to award one spouse temporary control of the family home as well as other property, such as the furniture and vehicles, for up to three years or until he or she remarries.
Along with property, the divorcing couple must also determine who owns all debt accrued during the marriage. Debt may include:
- Car loans
- Credit card debt
- School debt
- Gambling debt
When a couple can’t decide how to split up assets or debt, the court must resolve the issue for them. Unlike other court situations, there is no jury – the decision is ultimately made by an arbitrator or a judge. In Maryland, the following factors are considered when deciding what kind of property and debt division is appropriate:
- Length of the marriage
- The age, health, and physical and mental condition of each spouse
- Whether either spouse is receiving alimony
- Whether either spouse has been awarded use of the family home or other property
- The contributions, financial and otherwise, made by each spouse to the well-being of the family
- Each spouse’s economic circumstances
- Each spouse’s contributions of his or her own separate property to real, shared property
- How and when each spouse acquired property
- Any marital misconduct that contributed to the divorce
Getting a Maryland Divorce Lawyer
Obviously, it can be quite complicated when trying to split up assets and debt during a divorce. Seeking help from a qualified, experienced, and serious divorce attorney in Maryland can help you get the settlement you deserve or help you and your spouse negotiate a separation of assets and debts out of court. Keep the court’s hands off your assets!
Speak to a Divorce Attorney in Maryland for Any Property Division Questions You Have
Although divorce is a difficult time in one’s life, it is also an opportunity for a new beginning. Having a trusted divorce attorney in Maryland by your side is crucial for your peace of mind and success of the settlement. Call (301) 420-5540 to speak to a trusted and committed attorney.