Divorce is the legal process of ending a marital relationship. Spouses have to either reach agreements on how to separate their lives or ask a judge to make key decisions about the end of their relationship. Some couples reach agreements through mediation or because they have pre-existing agreements with one another regarding financial matters if they divorce.
Others have to settle everything while their relationship is at its worst point ever. Although settling property division matters is often the best option, some people truly cannot agree with their spouses about how to split their property when they divorce. If they cannot reach an agreement, then they likely need to take the matter to family court. A judge can then apply equitable distribution rules to the marital estate. What happens during equitable distribution proceedings?
Judges allocate marital property and debts
During equitable distribution proceedings, spouses generally have to disclose their financial circumstances to one another and the courts. They provide an inventory of assets. They have to report not only their marital property but also a separate property that they believe is not subject to division.
They also have to make disclosures regarding separate and shared financial obligations, including student loans and credit card balances. Judges look at the resources shared by the spouses and the financial obligations that they have assumed. They consider information about the relationship, including how long the marriage lasted and the standard of living that the spouses enjoyed.
They look at the circumstances of the individual spouses as well, such as their earning potential and the separate property that they may retain after the divorce. All of those details influence what the judge believes is fair. Fairness is the priority in an equitable distribution scenario. The goal is to make things as just and reasonable as possible.
The judge can order the sale of certain assets and allocate property to one spouse or the other. They can also declare one spouse responsible for certain marital debts. Spouses have no way of knowing exactly how a judge might handle high-value resources and various financial obligations during equitable distribution proceedings. They can request specific terms, but judges ultimately make decisions based on how they perceive the situation.
People who understand the basic rules that guide equitable property distribution may find that it is easier to navigate property division negotiations with their spouses and more easily identify when litigating might be the best option. Reviewing personal priorities and assets can potentially help people prepare for the division of their marital estate during a divorce.