The process of dividing marital wealth within a Texas divorce can be tedious. Few relish the thought of delving into the minute details of their financial standing, then negotiating the division of those assets. However, this is one of the most important areas of divorce, and must be given careful consideration. Property division outcomes will have lasting financial effects, and in order to achieve a favorable outcome, it is necessary to pay close attention to the details within the settlement.
One mistake that can cause a great deal of trouble involves how the family home is dealt with within the settlement. In most cases, one spouse will retain the home while the other walks away with his or her share of the equity paid out in another form. Some couples have the means to simply transfer cash or savings to pay off the spouse who does not retain the home; others negotiate a division of assets that gives the non-retaining spouse a greater share of some other asset.
Regardless of how this agreement is reached, it is imperative to clearly state within the divorce documents the manner in which the property is to be deeded and financed. In many cases, the spouse who stays within the home will have difficulty refinancing the property in his or her own name. This can cause serious problems for the spouse who leaves, as he or she will remain on the hook for the mortgage payments.
The best way to address this issue is to clearly outline, in writing, how the property is to be handled. There can be stipulations in place that require the retaining spouse to refinance the home within a certain period of time. There can also be guidelines for what actions will occur if the mortgage is not paid on time. The spouse who gives up the home during property division can remain tethered to the property for many years to come, making this an area of divorce law that can require a rigorous approach, both during and after a Texas divorce.
Source: Chicago Tribune, Fate of home uncertain after divorce, Ilyce Glink and Samuel J. Tamkin, Feb. 8, 2014