Can I sell the marital property to pay for my attorney? There are two possible methods to respond to the query. This applies both before and after the divorce case is resolved. Clients claim they are unable to afford legal representation but do have marital assets they can sell to cover costs. Before the case even begins, all of your marital assets are included.
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Both couples’ property is referred to as marital property. Your spouse will probably insist on receiving half of the asset’s value if you use or sell that marital asset. Your spouse might not be willing to deal with any of the assets to cover your legal expenses. The parties can do anything they wish with the assets they received once the divorce procedure is over and all assets have been distributed by a final decision.
What marital asset are we talking about?
We divide the assets of marriage in a divorce. Most of your possessions—or your spouse’s—were accumulated during your marriage. If there is a title or deed, it doesn’t matter whose name is on it. Unless it was a gift or unless it is an inheritance, that asset is going to be marital property. You both own everything; hence, it is marital property.
Marital home.
You spent your married life in a house. That house is known as your marital home. Consider who can afford to own the home. Can you keep the house? Can you afford its upkeep? Can you pay for the mortgage on the house? Between you and your spouse who has the financial capacity to keep it. Whoever owns the marital house pays for its expenses. You pay mortgage payments. You pay property taxes. And, you pay for maintenance too. It makes sense for the person who can afford to keep the home. There are times neither party can afford the house on their own. The only choice is to sell the house and split the proceeds.
One of two things could occur if your case gets to trial and the judge chooses how to divide your property. The residence could be given to one of you or sold by the judge. If the judge permits a sale, the money shall be divided equally between you and your husband. If you owe more than the house is worth, the difference will be split between you.
Retirement/ Pensions Plans
A pension or retirement plan is part of the marital property. A non-employee spouse is entitled to part of the plan. Especially the part accruing during the marriage. The spouse will receive a part of the retirement plan in the event of a divorce. Parties may agree to maintain their individual pensions. They could opt to keep their retirement plans whole and not split them. A spouse who is not employed may get assets equal to half of the retirement benefit.
The court must know beforehand the value of the properties involved before property division. This is to properly distribute marital assets in a fair and equitable manner. You can do this easily with a bank account but not with assets like a business or real estate. You need to consult an expert such as a business or real estate appraiser.
An appraiser is a specialist who determines an asset’s market value. This expertise is particularly helpful in the real estate sector. An appraiser is required to act independently in a transaction of buying and selling. They must make an unbiased conclusion about the true and fair worth of an assessed asset. They use observations and any pertinent data, facts, and other information. The appraiser’s conclusions may be expressed verbally or in writing.
Evaluating retirement accounts may be particularly challenging. This is especially challenging when they are divided before their pay-out period. You need to figure out the account’s current worth. This calls for an actuary’s help.
An actuary helps clients reduce risk. An actuary does this by estimating the financial impact of uncertainty. They use math and statistics. A certified actuary can assess and control the risks involved in financial investments. This also applies to insurance policies and other potentially risky activities.
The court has to go through all the processes above to arrive at the phase we call property division. It is not easy to proceed to property division until all the marital assets are identified. Their value is then determined before you can say how much value in dollars goes to one spouse and the other. Until a divorce judgment is final, you can’t determine the value of the asset you are entitled to.
Can I sell the marital property to pay for my attorney?
A status quo order can be in place once the divorce process starts. Usually, a status quo order involves money. The status quo order demands that both parties continue to make contributions to all debts. These debts include the mortgage, insurance, and grocery bills. Both parties can have the same access to cash and credit as they did before the divorce was filed.
The financial status quo ensures financial access and bills payment remain the same. This can be so at least in the short term. This is because the legal waiting period for a divorce without minor children is 60 days. For divorce with minor children is 180 days. It is inevitable that things change in every divorce.
Ex parte restraining orders frequently entail the transfer of property. The parties are prohibited under the order from taking any extraordinary financial decisions. Especially decisions without the other party’s permission. There is the option for the opposing party to protest the entry of the ex parte order. The orders, however, continue to be in full force and effect while there is a hearing.
You are thinking or deciding on divorce. You don’t know where to get the money for the attorney fees or the filing fees. Maybe you know but you’re not sure if you want your spouse to know your filing for divorce. You’re thinking, should you sell properties? You’re thinking, can I sell properties to pay for my attorney?
The “American Rule” is applied by litigants in American courts. Parties to a lawsuit are normally responsible for their own legal fees and costs. This is so unless a statute, court order, or other agreement orders otherwise. Meaning the court allows one party to be held responsible for the legal costs.
This is contrary to the “English Rule.” This is used in other countries. It mandates that the losing party pay the victorious side’s legal fees and costs. In Michigan, participants in divorce procedures often pay for their own attorneys. The court has the authority to require one spouse to pay the legal fees. The court can charge the other spouse in some situations.
Your spouse may not agree to the divorce. That alone should give you a signal that selling property to pay for a divorce attorney is off the table. All assets at your disposal are most likely marital assets. You can’t sell any unless your spouse consents or the court allows you. We mentioned the status quo order and the restraining order. Those orders are keeping all finances in place the way they are. This prevents you from selling or negotiating any property considered a marital asset.
Find some other way to pay for your legal fees. Ask someone outside your immediate family to give you a loan or have your attorney retainer charge to their credit card. Talk to your attorney. Know the best way to deal with your money matters. Be sure about your decision to divorce. Do that before talking to an attorney.
Can my spouse pay for my legal costs? My attorney fees?
You can be a dependent spouse. Ask the court for an award of legal fees. You can be eligible for alimony payments or other post-separation assistance. If you are granted attorney’s fees, your spouse will be held liable for your reasonable legal expenses. If one spouse acted in bad faith and prolonged the legal proceedings excessively, attorney’s fees may be awarded to you. You can also seek the court for an advance of your share of the property division from the divorce. This is if an attorney-fee award would not be applicable to you but you are still having trouble paying your legal bills.
A judge may also grant legal fees on the basis of blame rather than the party’s financial situation. A divorce case may occasionally be prolonged unduly by one party acting in bad faith. It unfairly increases the innocent spouse’s attorney bills. This can take the shape of defying a court order, hiding assets or refusing to give documents. Other times it might take the form of one spouse engaging in unnecessary litigation. Making untrue accusations against the other spouse or refusing to compromise.
The Court may, at its discretion, order the at-fault party to cover some or all the other party’s legal expenses in such a situation.
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