What is a Divorce Financial Settlement?
A divorce financial settlement is an agreement reached between a husband and wife to sort out how the assets will be divided following their separation or divorce. The assets to be divided could be held jointly by the couple or in their individual names. Assets can include items such as the family home, pensions, investment savings, a buy-to-let property portfolio, or the family business.
In this article, our family law solicitors look at how they can help you reach a divorce financial settlement and offer some guidance on how agreements can be reached.
Online and London Family Law Solicitors
For family law legal advice call the expert London family lawyers at OTS Solicitors on 0203 959 9123 or complete our online enquiry form.
How to reach a divorce financial settlement?
There are several ways to reach a divorce financial settlement. A divorce solicitor can help you work out which option is likely to be the best one for you and your family.
You may be tempted to reach a financial settlement without taking legal advice. That is not a good idea. For example, your ex-husband or wife may not have disclosed all their assets, have undervalued a pension, or told you that you are not entitled to assets owned in their sole name. For example, your estranged spouse may agree with your proposals and then renege when they take legal advice later.
Ways to reach a divorce financial settlement include:
- Solicitor negotiations
- Solicitor-led roundtable meeting
- Direct negotiations after you have taken legal advice
- Family mediation after taking legal advice
- Family arbitration
- Family court application for a financial court order
A family lawyer can advise you on your options and how they relate to your circumstances. For example:
- Family mediation may be a good option if you are both committed to reaching an agreement
- Your best option may be to start court proceedings for a financial court order if you suspect that your ex-husband or wife is not providing you with full and frank financial disclosure of all their assets or you are concerned that they are selling or transferring assets out of their name to defeat your financial claims or are worried that a significant proportion of their assets are held overseas
Recording your divorce financial settlement
Whatever method you use to reach a financial settlement it is important to record the agreement. If you do not do so you could end up arguing over whether there was an agreement reached or the precise terms of the agreement.
If you have separated from your husband or wife but you have not started no-fault divorce proceedings your financial settlement can be recorded in a separation agreement. When you get divorced the separation agreement should be converted into a financial consent order. The order can be made without either of you having to attend a court hearing.
If you have started no-fault divorce proceedings your agreement should be contained in a draft financial court order. The order can be submitted to the court for approval once you have obtained your conditional order of divorce.
If you are unable to reach a financial settlement and one of you starts a financial application the court will make a financial court order after hearing evidence and reaching a decision on the appropriate settlement.
What should go into your divorce financial settlement?
What should go into your divorce financial settlement depends on a whole range of factors, such as the extent of the family assets, the existence of any non-family assets, the needs of any children, and the needs of yourself and your spouse.
If the family court decides on the divorce financial settlement as one of you applies to the court for an order, then the court will consider a range of statutory factors, such as your respective ages, length of your marriage, health, income, and earnings potential as well as whether any of the assets were acquired pre-marriage or the existence of a prenuptial agreement or a postnuptial agreement.
A divorce lawyer will look at the extent of all the assets and advise you on the likely range of financial court orders should you or your spouse apply to the court for a financial court order. For example, in some cases, it may be clear that the court is highly unlikely to make a spousal maintenance order. In another family situation, the court may be likely to order spousal maintenance and your divorce lawyer will be able to advise you on the likely amount and the length of the order. This is not an exact science as the specialist divorce solicitor is using their knowledge and experience to give you their best advice on the range of likely court orders rather than being able to telepathically work out exactly what financial court order a particular family court judge might order after contested court proceedings.
What goes into a financial court order will depend on so many factors so it is impossible for a divorce lawyer to tell you in a blog what you will get as your divorce financial settlement and the best wording for your financial court order. For example, for a spouse nearing retirement age, a pension-sharing order may be more appropriate than a spousal maintenance order. That is because a pension-sharing order lasts until the receiving party passes away. A spousal maintenance order automatically ends if the receiving party remarries or if the court ends the order. For example, an immediate order for the sale of the family home may be appropriate, or a deferred order for the sale of the property may better suit your circumstances because of the ages of the children.
Whatever your personal or financial circumstances, our specialist family law solicitors can help you understand your legal rights and options and assist you in working out the best way to navigate and reach a divorce financial settlement.
It is important to take legal advice on your divorce financial settlement as your verbal or written agreement may be legally binding on you. That is why it is best to take your time to get a divorce financial settlement that meets your needs and that you are comfortable with.
Online and London Family Law Solicitors
For family law legal advice call the expert London family lawyers at OTS Solicitors on 0203 959 9123 or complete our online enquiry form.
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