Business

Here’s how to protect your home at the start of a marriage in case of divorce

DEAR MR. MYERS: I live in a house that I have owned by myself for several years, but now I am getting married to a woman who earns more than I do but has never owned a home before. Will it be necessary to put my new wife’s name on the title to my home? Should I ask her to sign a prenuptial agreement?

ANSWER: The decision to put your bride’s name on the title to your longtime home is a highly personal one. Doing so will automatically give her a half-interest in the property, but no legal responsibility to help make the monthly mortgage payments unless her name is also added to the bank’s original mortgage contract. I don’t want to seem unromantic, but it’s a statistical fact that more than half of all marriages end in divorce: Talking about your concerns with your fiancee now could prevent several problems from arising later.

The two of you certainly could sign an agreement now that states that everything that each of you brings into the marriage (including the house) will remain your sole and separate property forever. It’s not an ironclad way to protect either person’s assets, but it’s a good head start toward resolving potential problems that may develop down the road.

You probably don’t need a full-blown “prenuptial agreement,” which would spell out how the assets of each of you would be divided in case of a divorce. Lawyers generally recommend prenups only for those who are marrying someone with much less money or with much more debt, or for people who are financially responsible for children from a previous relationship.

People who are involved in a family-owned business often also sign a prenuptial agreement to reduce the chance that an eventual divorce would jeopardize an enterprise that may have been in the bride or groom’s family for decades. Discuss your real estate and other financial concerns about your upcoming wedding with an attorney, as well as with your sweetheart.

DEAR MR. MYERS: I am applying for a mortgage, and the bank’s loan officer wants to see a copy of my divorce papers that I received six years ago. Those papers were destroyed by a fire in my garage; my ex-wife is nowhere to be found; and I can’t get a copy from my previous attorney’s office, because it closed up shop after he died a few years ago. What can I do?

ANSWER: All divorce papers must be approved by a judge or other representative of the court, so start the hunt for the missing papers by calling the county clerk of the court in the area where the divorce was granted and recorded. The state’s department of records also should have a copy of the decree on file, but it’s usually faster to get results by working through the county rather than dealing with the state’s larger bureaucracy.

DEAR MR. MYERS: My husband and I are getting divorced. We have worked out most of the financial issues, but we can’t decide what we should do with our home (he wants to sell it, but I want to rent it to tenants). Would it be possible to have the divorce finalized now and then deal with the house later?

ANSWER: Yes, you probably can get the divorce completed now and figure out what to do with the house later. That’s because most states have a legal process called “bifurcation,” which allows a divorce to be finalized as quickly as the law allows, even if all of the couple’s real estate or other financial issues haven’t been resolved.

Yet, bifurcating a divorce can cause a lot more problems than it solves – especially when a longtime home is involved. Who would live in the house and make the monthly mortgage payments while the financial details of the divorce continue to be negotiated? If it’s rented out instead, who will be responsible for finding a good tenant, collecting the checks and dealing with potential problems?

And God forbid, what would happen if one of you dies after the divorce is granted but before a financial settlement is reached?

Because the two of you have already worked out most of the financial issues arising from the divorce, you probably should avoid the bifurcation process and instead redouble your efforts to reach an amicable solution for the use or sale of your longtime home. If no agreement can be made, either of you can file a “partition” lawsuit, which would ask a judge to order that the property be sold immediately and the profits split.

David W. Myers’ column is distributed by Cowles Syndicate Inc.

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