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Guarding Your Financial Future: Selling Assets Before Divorce

Heading into a divorce? Be sure to watch out for a dirty trick that spouses sometimes attempt- selling assets secretly. This involves a spouse taking an asset without telling the other spouse to be aware of it. Then, placing the asset for sale on the internet or through any other means. The result is that your spouse pockets this money and discloses nothing of it to you. With luck, your spouse thinks, you will just forget the asset even existed. Even if you remember- he or she will plead ignorance. 

What to do in a situation like this? Having a plan to prevent this from happening in the future is essential to your success. Do not assume that your spouse acts as honorably as you do. You can hope for this, but it is best to verify that he or she is acting as honestly as you are. Checking in with your spouse, communicating, documenting, and acting quickly helps to alleviate concerns over the selling of assets before a divorce. 

Interested in learning more about divorce? The blog for the Law Office of Bryan Fagan is a great place to start. We provide our community with unique content every day about Texas family law. However, to take your journey toward knowledge a step further please contact our office today for a free of charge consultation. We will answer questions and provide you with information that allows you to gain an advantage in the early stages of a divorce. 

Be aware and act intentionally

Many people in your shoes are caught off guard by a divorce. You live your life as normal and then seemingly out of the blue a divorce is thrust upon you by your spouse. There is nothing wrong if this happens to you. Again, a lot of people have this occur. However, that does not mean you shouldn’t be on the lookout for this type of occurrence.

Pay attention to what is going on around you. Not every divorce is something that you can anticipate. Seeing the future is not a gift that any of us are blessed with. However, the more you pay attention the more you find that you can anticipate trends and events successfully. Looking closely at the behavior of your spouse (their actions and words) matters. Once you start to see their actions you then anticipate better what comes next. 

Once you see a divorce on the horizon it is time to act intentionally. This means to have a purpose behind everything you do. Is it time to start looking for a lawyer? Contact the Law Office of Bryan Fagan for a free-of-charge consultation. Need a place to stay for a few weeks? Start to talk to friends and family who live in the area. When it comes to your property that is a main area where people need to look to prepare. This is what you should look at when it comes to protecting yourself financially. 

The harm posed by a spouse who sells assets before a divorce

Heading into a divorce means controlling what you can. That means your relationship with your kids and your finances. Today we are focusing on your finances, but you cannot focus only on one subject. A divorce includes every area of your life. Focus on only one of them and your life will suffer in those other areas. Today’s blog post is a good place for you to start an analysis of the areas that are most important to you. 

Your financial situation is always changing. It’s a fluid circumstance that depends upon your income, your budget, and the needs of your family. While many people suffer financially during a divorce that does not have to be your experience. By acting intentionally and focusing on the financial issues that matter most to you, it is possible to arrive at a positive outcome. You do need to look closely at your outlook from a financial perspective.

Use the divorce as a time to get right with your money. If you have been not paying attention to how you spend money, then a divorce is a perfect time to get on a budget. When you think you could be earning more money than a divorce helps you develop the motivation to learn about new job opportunities. This starts with intentionality and having a plan. Take the time to think about what is most important to you from a financial perspective. Then, develop a plan that takes you to those goals with the least amount of disruption possible. 

Budget, budget, budget

We at the Law Office of Bryan Fagan cannot emphasize enough how important it is to develop a strong habit of budgeting. Notice that we use the word “budget” as a verb and not a noun in that sentence. This means that you should be constantly working on the budget. Actively attempting to take into consideration your current financial circumstances before you attempt to do anything additional with your money. Stop what you are doing and create a budget. 

A budget does not need to be something complicated. There are certainly applications for your phone which you can utilize. These have nice features, but the bottom line is your budget needs to be done before a divorce begins. The reason is that it takes time for you to complete a budget correctly. It is not easy to get all of your information down and to project costs out. The income and the “out-go” makes a budget an essential tool in your toolkit. 

Many people in your shoes feel uncertain about a divorce at the beginning. This is due in large part to not having a plan in place for your finances. People are so focused on the many issues associated with a divorce that they are unable to take into consideration all of the ways a budget can help. A budget is not a straitjacket for your money. Rather, a budget permits you to spend because you know where your dollars are going. 

Take advantage of your planning in a divorce

Many people in a divorce try to focus their time and attention on issues that have little bearing on the results of the case. The best example I can give you is arguing with your spouse over petty, day-to-day issues. We all know what type of topics I am talking about. These are the little arguments that tend to get our attention but ultimately are not that important. Avoid topics like this. 

Instead, take time at the beginning of your divorce to think about what matters most to you in your finances. Of course, if you are a parent then your children are going to matter more to you than anything. Let’s consider this a given. However, in today’s blog post, we are focusing on finances and asset distribution. Look at your finances and start to think about what matters most to you when it comes to money, assets, and debt. 

It is said that a divorce takes a marriage and causes it to become a business transaction. This is true to a certain extent. Marriage is not easy, and divorce is even less easy. However, when you slow your case down and look at it from a certain perspective you gain an insight into how to proceed. Many people do not slow down their minds to do this. Instead, take some time and map out all the different areas of your finances and decide how you want to proceed.

Asset allocation and division

Dividing up marital assets is a key part of your divorce. Marital property in Texas falls under the category of community property. Community property is presumed to be all property at the beginning of your divorce. Specifically, this is property gained during the marriage. Community property is subject to division in a divorce. Depending upon the length of your marriage this may be all or most of the property that you own. 

On the other hand, property that you owned before your marriage is classified as separate property. Separate property also encompasses property acquired during the marriage either by gift or inheritance. One perspective in a divorce is that you want most of your property to be separately owned so that you do not have to divide it up in the divorce. Whether or not you can have this happens depends on the purchase date of the property for the most part. 

This is a very simple overview of community property law in Texas. For a more detailed outlook on this subject, we invite you to look at the blogs on our website more focused on this subject. However, to learn more about property division, community property, and how they interact with your situation please contact the Law Office of Bryan Fagan today. We offer free-of-charge consultations six days a week where we will provide you context about your specific circumstances. 

Debt is a true “four letter word”

Debt is the ugly stepsister of property. We all know it exists. We would rather just overlook debt in favor of property. It’s more fun to plan out how we are going to sell our marital home and split up the equity. Thinking about debt is not any fun at all. Much of the time, frankly, we find ourselves in a situation where pondering debt requires that we re-hash old money mistakes. That is not a fun time and causes us to look back at our lives with some degree of regret.

With all of that said, debt division is necessary in a divorce and does need to be discussed. Very few people who go through a divorce have a good idea about what sort owe overall. You have a few debts that you are aware of. Your mortgage is foremost among them. With that said, some people don’t even consider a mortgage to be a real debt. However, all debts affect your divorce. It is time for you to start thinking about how you acquired that debt.

Debts fall into similar categories as property as far as separate debts and community debts. A home mortgage, for instance, can count as a community debt in a divorce even if your name is not on the loan. This makes for an interesting situation where you may be assigned a debt in the divorce that does not have your name on it. However, because the debt was acquired in the divorce, and you used the property attached to the loan it becomes your debt after the divorce.

Your spouse starts early on with the question of property division

Here is where you need to have a real plan in mind. Suppose that your spouse already has planned out your divorce. He knows that he wants to divorce you. This is something that he has had in mind for months. From that standpoint, he wants to get a jump on organizing his property but also your marital property. He takes advantage of you going to Austin to visit your sister one weekend. 

When you get home from the trip you find that several expensive items in your home are no longer there. Your husband took it upon himself to go out and sell these things. You have no idea where, but you assume it was done through places like Facebook Marketplace. This is frustrating, to say the least. From there, you jump online to see what he has been up to. 

Sure enough, you log into his Facebook (he has his password saved on the home computer) and sure enough he has sold a lot of your property through Facebook. A television, some artwork, and other items around the house. Thousands of dollars of community property are now sitting in a bank account somewhere. You check your family checking account and see no recent deposits. He must have put the money somewhere you can’t get to it. 

What to do when your spouse has sold property from under your nose

When your spouse has sold property of yours from under your nose there are steps you can take to recoup that money. It starts with ensuring that it won’t happen again. Inventory your property. This means compiling a list of all the properties that you own. Go through your home and categorize the property. This means coming up with a list of household items, vehicles, clothes, electronics, and things of this nature. 

Next, start to think about your investments as well as those of your spouse. This property may be under your name or your spouse’s but if accumulated during the marriage it is community property. Log onto the internet and pull up the balances of these accounts. Figure out when money started being contributed to them. This will help you determine how much of the account (if any) is community property. Not being able to access your husband’s accounts is not a huge issue. However, think about what he owns so you can request the information during the divorce.

Go to your spouse and make sure he is aware you know about his selling of this property. It does not take much planning to have quickly sold the property. Ask him in a civil manner for information on the property that was sold. The money needs to be added to the overall value of the community estate. If nothing else, he is in a position where a judge penalizes him for selling property in anticipation of a divorce. When he won’t cooperate with you it becomes time to hire an attorney.

What to do when your spouse will not cooperate with you on the sale of property

Try to be as civil as possible when it comes to the sale of property before a divorce. Catching him red-handed already puts him in defense mode. There are ways to resolve these issues amicably. The quicker you realize this the better it would be for your divorce. Remember that you need to work with your spouse on the divorce. Showing respect is a key part of this.

When your spouse stops working with you and even communicating with you then it becomes time to hire an attorney. When you file for divorce, you ask a court to put a stop to either of you selling property that needs to remain in place for the duration of the divorce. It forbids either of you from locking the other out of the house or your vehicles. These temporary orders allow you both to play nice in the sandbox for the time being.

The attorneys at the Law Office of Bryan Fagan are prepared to help you manage your divorce. Contact us today for a free of charge consultation. 

Questions about the material contained in today’s blog post? Contact the Law Office of Bryan Fagan    

If you have any questions about the material contained in today’s blog post, please do not hesitate to contact the Law Office of Bryan Fagan. Our licensed family law attorneys offer free-of-charge consultations six days a week in person, over the phone, and via video. Interested in learning more about how your family is impacted by the material in this blog post? Contact us today.

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