Dividing property during a divorce can be one of the most difficult tasks people go through. Even an experienced Orange County divorce mediation attorney doesn’t always look forward to this challenging discussion, especially in the complicated legal system found in California.
Couples often accumulate a variety of assets like vehicles, real estate, bank accounts, investments, business holdings, and more.
With the help of your Orange County divorce attorney, you can get a better grasp of how this portion of your divorce will take place. While the courts can take over this part of the process, judges often prefer to see asset division take place through direct negotiation over the banging of a gavel.
Here are five tips to help determine the value of your processions during a divorce:
1. List and Appraise
According to a number of Orange County divorce attorneys, one of the best ways to start the asset division property is to make a list of everything you both own.
Some items will clearly belong more to one person than the other: for instance, the chef of the family probably has more attachments to the fancy Japanese cooking knives than the partner who never touches the stove.
Ideally, both parties will agree on most of the items when it comes to who has a better claim on them. There may be some things that are harder to determine, and that’s okay for now.
On your list, determine a modern value for each item. This could come from looking up current selling prices, receipts, etc. You can also turn to appraisers who can accurately determine value in their field of expertise.
You can now add up the values of all the items belonging to each person. You can use the cash value of all remaining items to help even out the final total value each person will get.
2. Value Isn’t Always Monetary
Some assets offer a more direct path to determine their value. For example, a bank account with $100 dollars in it is worth $100. Other pieces of property aren’t as easy to assess. Of course, a judge may not acknowledge elements of something value beyond its liquid, monetary value.
Many things that are purchased or obtained by a couple were really done so at the will of one person. Other items may have been picked out by both parties, but hold a larger sentimental value to one person than it does to the other. If these kinds of items are negotiated outside of the courtroom, they could be thrown in with regular property that has no value.
Christmas decorations, for example, may have a stronger meaning to the couple than what their price tags might suggest. These could be simple ornaments made by the children or a collection of special edition Hallmark ornaments released each year. It would be devastating to have to sell these items or simply divide them equally.
While sentimental value may not be applied in court, it is something that you and your separated partner should consider and keep in mind. Take note, though, fighting for something that is important to the other person simply out of spite or to enrage them never ends well.
3. Real Estate Isn’t All About the Current Market Value
The house you bought with your spouse may seem like one of the easier assets in which to determine its value. You bought the house for a certain amount, put in a few repairs or upgrades, and then there’s a final value.
The reality is that real estate values come from a variety of sources. For example, a real estate agent would look at more than your purchase price. She would look at similar houses that have recently sold in your area, combined with a consideration of overall property values, upgrades, and more. There are also professional appraisers who are skilled at determining a current value.
Pretend that you bought a home with your spouse for $200,000 several years ago. Now imagine that the value of your home increases by $50,000 by the time of your divorce. The actual equal division would be on the current value and not the original purchase price.
4. The Future of An Asset Matters
Some assets are obtained with the hope that they will increase in value. The simplest examples are things like investments and real estate. Many couples take ownership of these items with the hope that they’ll get a nice return in the future.
Some assets aren’t as straightforward. For example, you and your spouse may have purchased a piece of art for $1,000 at an art show. The artist explodes, and his work increases in value.
During your divorce, an expert in this area might suggest that your piece of art will be worth $10,000 in less than ten years. This kind of testimony should impact how you discuss dividing assets and who gets to keep different items.
5. Don’t Forget The Debt
When most people think about dividing assets, they often imagine deciding who gets to keep the house, the car, or the collection of Disney snow globes. Sadly, they don’t think about the other items that become part of the negotiations: debt.
Debt that is incurred by the couple during their marriage is typically split evenly between both parties. This is true even if only one person signed up for the debt under their name. For example, if one partner opens a department store credit card and makes numerous purchases, both parties may end up with part of the debt. This can be true even if they aren’t both aware of the debt.
There are some exceptions, where a court clearly sees the debt as belonging to one person. For example, if one partner spends exuberant amounts of money buying gifts for someone with whom they are having an affair. A judge may not force both parties to repay this clearly one-sided debt.
Courts often consider dividing debt based on each person’s ability to pay back the debts. It would be unfair to load the partner who didn’t work in order to raise the children and maintain the house with large amounts of debt that they didn’t necessarily contribute to. At the same time, judges are under no obligation to divide debts this way. It’s possible that all outstanding debts are shared equally, regardless of each person’s financial situation.
Don’t Go Into Negotiations Alone
While you might like to think that your divorce will remain civil, it doesn’t always turn out that way. When money is involved, people can act erratically. That’s not to mention any animosity, frustration, or mere confusion going through your ex-partner’s mind.
Instead of walking into what could be an ambush, it’s always a great idea to consult with an Orange County divorce mediation attorney. These professionals can help advise you or even represent you if things get ugly in court. Chances are, your ex has already spoken to an Orange County divorce attorney. Don’t go outmanned.
The professionals at Lemkin Law are on your side. From providing a game plan to offering assistance towards getting back on your feet, our team of expert, skilled, and friendly lawyers is here for you. Give us a call to learn about your options today.