Property Issues During Separation

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 What Are Property Issues That May Arise During a Legal Separation?

A legal separation is when a married couple comes to the conclusion that they will no longer live together and requests that the court oversee the separation process. A legal separation is more formal than just moving apart.

Instead, the couple creates an agreement that divides property, sets child support and custody, and includes everything the couple would include in a divorce agreement. To put their separation agreement into effect and make it enforceable, the couple obtains court approval of the document.

What Is the Date of Separation?

One key element of the separation agreement is the couple’s choice of the date of separation. This will matter when it comes to dividing property, for example. Property issues may deal with the marital home, cars, gifts, inheritances, assets, or debts from the couple’s marriage.

The “date of separation” definition differs from state to state, but it is usually considered the date that spouses no longer reside together as a married couple. This would be when one spouse moves out of the marital home with the intent of ending the relationship.

Sometimes, the spouses do not immediately split up physically when they intend to end the relationship by legal separation. In these situations, the judge will examine other factors to determine the date of separation. It could be as simple as an email from one spouse to a friend indicating that the couple was splitting up for good on a certain day.

How Does the Separation Date Affect Income and Property Division?

The date of separation plays a critical role in determining the parties’ interests in property and debts. Whether property, assets, and debts are marital or separate property depends on whether they were acquired before or after the separation date. Assets and debts acquired by one of the spouses after the date of separation are presumed to be separate property owned by that party individually.

In most states, any income a spouse earns during the marriage is considered marital property. This means that each spouse has a right to the income that the other made during the marriage. The income that the spouses earn after their date of separation is considered their own separate property. Money a spouse earns before the date of separation, which is paid out after the date of separation, is still marital property.

As with income, other types of property obtained during the marriage but before the date of separation will also be labeled as joint property. For instance, if the couple purchases a home, car, boat, or another type of property with marital funds before separation, the home will be considered joint. In some states, that will mean it will be divided 50/50, and in others, the property will be divided equitably, considering various factors (see below).

How Does the Separation Date Affect Child Support and Alimony?

The date of separation can determine when a spouse becomes responsible for child support and alimony (also known as “spousal support”). For example, if a husband who earns all the household income moves out of the marital residence, a court may order him to pay temporary child support and alimony from when he left. In some states, however, a spouse may only be required to pay child support or alimony after a divorce action has been filed.

How Is the Property Divided?

If the parties do not agree on how to divide their property, the court will decide what marital property will be divided up and how much it is worth. The court will also examine any marital debts (for example, mortgages and credit cards) when determining the value of the total marital property. If you decide not to hire a lawyer, you must research your state’s law regarding property distribution.

The court will then determine each spouse’s portion of the property. In one of the country’s nine states that follow a “community property” scheme, all property and debt will be divided precisely in half.

In the non-community property states, the scheme for dividing property is called “equitable division.” To determine how much to award each party, the court will consider these factors:

  • The length of the marriage
  • How much each party contributed to the well-being of the family (this includes income, but also contributions such as caring for the married couple’s children or maintaining the family home)
  • How much each party’s individual property is worth
  • The economic circumstances of each party at the time the court makes the award
  • In some cases, the reason the parties are seeking divorce and how they got there
  • Each spouse’s age
  • The physical and mental condition of each party and their ability to work after the separation
  • How and when the parties obtained specific marital property, including how much effort each party expended to accumulate the marital property
  • Any award of alimony
  • Any other factor that the court considers necessary or appropriate to arrive at a fair money award of property.

Who Is Responsible for Debts?

Usually, the court or a divorce agreement can decide who is responsible for debts such as car loans and credit cards. However, it is important to remember that if you co-signed with your spouse on a loan or for a credit card, and your spouse does not make payments when they are due, you can still be held responsible by the lender even though you have separated or divorced.

Sometimes, the creditors can sue you even if a court order states that your spouse is responsible for the debt. To protect yourself, you should write to creditors to ask them to close any joint accounts.

What happens if one spouse owes the other money but does not have the money to pay? Sometimes, the court can order the marital home to be sold to pay money one partner owes to the other. However, If one of the parents has custody of the children and is still living in the marital home, the court can order that the sale be delayed, usually until the children have graduated high school.

What Are Exclusive Occupancy Rights?

Exclusive occupancy rights allow one spouse to live in the marital home. The other spouse has to find somewhere else to live. These rights can be granted to the parent with the custody of the children if the court has delayed the home sale.
They can also be given for one of the spouses’ safety while the divorce is finalized. If there has been violence in the home, courts can also give orders of protection designed to prevent the attacker from entering the home or being on the premises (e.g., the lawn).

When Do I Need to Contact a Lawyer?

If you are filing for a legal separation and have concerns about the property issues that may arise, it will be very helpful to contact a local family lawyer.

This is your one chance to make sure that your financial interests are protected and that you get a just result. You will feel more confident in the end if there has been an attorney guiding the process and explaining every step to you.

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