Getting divorced doesn’t just mean separating your life from your former spouse. It also means a fair division of property, including your finances, possessions, and any assets you and your spouse acquired throughout your marriage. A property settlement agreement can help set out vital information about marital property, making the process of divvying up and moving forward much smoother in the long run.
What Is a Property Settlement Agreement?
A property settlement agreement itemizes the separate property each spouse will take when the divorce is final. It includes a comprehensive list of the things that will belong to each spouse after the divorce, how that division will take place, and an overview of your shared debts and other payments each spouse might be responsible for handling.
Types of Property Included in a Property Settlement Agreement
Your property settlement agreement does not have to include every piece of property you and your spouse have — that is, you don’t have to worry about going through the kitchen cupboards and taking out every individual item to discuss who gets it. It should include any hotly contested marital assets and big-ticket items with legal separation, however, including:
- Family home
- Any rental or investment properties that you and your spouse shared ownership of during your marriage
- Distribution of money in your bank accounts
- Any trusts held by either of you
- Distribution of your retirement accounts
- Any big-ticket items that may be contested, including collectibles, artwork, electronics, etc.
Consult a divorce lawyer to learn more about the assets you need to consider as part of your separation and property settlement agreement.
Other Marital Settlement Agreement Concerns
In addition to the specific types of property covered by the property settlement agreement, your agreement should contain several other important factors, including:
Will one spouse provide insurance for the other for a period of time? This is most common when one spouse does not have insurance through work. Similarly, will one of you carry a life insurance policy on the other?
When one spouse pays alimony, or spousal support, for the other, it should be included as part of the property settlement agreement.
- Taxes and any tax-related questions
This may include tax concerns for the last year of your marriage as well as any future tax impacts the divorce may have.
- Division of debt
In addition to fairly distributing your assets, you must consider a fair distribution of your joint debt after your divorce. Virginia law requires equitable distribution of both property and debt in a divorce agreement, including attorney’s fees.
These important details can have just as much impact on your financial status and how you manage those finances after your divorce as your assets. It is thus imperative that you take them into account when preparing your property settlement agreement.
The agreement is referred to by the various names below.
Property Settlement Agreement
Marital Settlement Agreement
Separation and Property Settlement Agreement
Memorandum of Understanding
Not Sure How to Split Your Property? Contact a Divorce Expert.
In some cases, both parties might be unsure how to split up their joint property. Virginia law mandates a fair and equitable split, but equitable does not necessarily mean 50/50 with each spouse taking half the possessions and debt. That makes the process even more difficult to understand and ensure a fair resolution for each side. Working with a trusted attorney to create a successful property settlement agreement can make it easier to manage those important changes.
If you are currently going through a divorce or planning to do so in the near future, it’s time to start planning your property settlement agreement. Contact our law firm today to discuss your separation and property settlement agreement questions, or to speak with an expert law firm about other family law questions you might have.
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