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What are we each entitled to in our divorce settlement?

What does the law say about how to split the house, how to share pensions and other assets, and how much maintenance is payable.

What steps can we take to reach a fair agreement?

The four basic steps to reaching an agreement on divorce finances are: disclosure, getting advice, negotiating and implementing a Consent Order.

What is a Consent Order and why do we need one?

A Consent Order is a legally binding document that finalises a divorcing couple's agreement on property, pensions and other assets.


Do you need help sorting out a fair financial settlement?

Our consultant service offers expert advice and support to help you reach agreement on a fair financial settlement quickly, and for less than a quarter of the cost of using a traditional high street solicitor.


Dividing Equity in House - Assets - Furniture etc

  • IATM
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19 Aug 12 #350592 by IATM
Topic started by IATM
Hi All,

I know this question gets asked a lot and I tried to search for a similar situation however I could not find anything.

A family member is going through a divorce and I am really worried about them in terms of the torture they have been through but also that they may come off worse financially.

The main concern I have is the equity in their marital home (in both their names) as is the mortgage.

House worth: 230k approx
Outstanding Mort: 130k

Initial deposit: 50k from husband, 10k gift from mother of husband and remaining 30-40k equity was paid off by both of them.

They have been married approx 3-4 years - Husband earns approx 50k and wife earns approx 28k.

They have a car each - furniture was mostly purchased together which she doesnt care for if he takes it tbh but I am worried for her in terms of the equity in the house.

What would be the general concencus in terms of split in the above scenario.

Maintenace of the house, paying of extra lump sums of the mortgage and running of the house has been predominantly been at best a 50 50 split if not the wife doing more.

any advise would be welcome. they are not on talking terms - would it be best to get a lawyer involved now or a mediator. are they the same thing:S

  • Fiona
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19 Aug 12 #350595 by Fiona
Reply from Fiona
The starting point in Scotland is any assets, apart from gifts and inheritances, accrued between the dates of marriage and separation are matrimonial property to be shared. If gifts and inheritances become incorporated into the family finances they are considered matrimonial too, particularly if they were used to purchase a property with the intention of it being the family home.

The value of all the assets (including any pensions) minus any liabilities forms the net value of the pot to be shared "fairly," usually 50:50. There are arguments to move away from 50:50 if one party has been economically disadvantaged by the relationship, say because they gave up employment to care for children, and an exceptional contribution brought to the marriage might be deemed special circumstances justifying a larger share.

Your family member would really need to see a family solicitor to find out where they stand and what options there are in the specific circumstances.

A mediator may also be a solicitor but doesn''t have to be. mediation can be really useful for separating spouses to go through the finances and arrangements for any children with someone who is impartial to find away forward that can work for everyone. By minimising confrontation there is less likely to be conflict which can be expensive in terms of both time and money and damages long term family relationships.

One form of mediation is collaborative law which appears to be quite successful in Scotland. Both spouses and their solicitors have a series of meetings to try and find away forward. The advantages are that everyone is trying to work together so that it''s a win/win situation rather than traditional win/lose advocacy, when each party is trying to secure the best deal possible for themselves at the expense of the other party.

The solicitors agree not to work on the case anymore if no settlement can be reached so it''s in their interests to resolve matters too. One of the advantages of collaborative law is that other professionals such as accountants or counsellors can be involved in the process too. Of course the disadvantage is if no settlement can be reached there are further legal bills, but by then the parties should have some idea what can be agreed, what might be agreed and what the disputed issues are

Hope that helps. :)

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20 Aug 12 #350598 by IATM
Reply from IATM
Hi Fiona,

Thank you very much for the detailed information, I was very much of the assumption that it would be 50 50 regardless of what was before due to the fact that everything was shared thereafter etc - it just seems to be a very unfortunate case where people have got involved and things have got messey; so really want to move it forward now in the best way possible.

Really interesting to read on the collaborative law part and something I can certainly look into for the person. We are going to have some appointments set up with a few firms and see what they say as well. Thanks again have a nice evening.

:)

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