By avoiding these 5 financial mistakes during a divorce it could save you thousand of dollars after your divorce is final. Many individuals act on emotion as opposed to logic and for that reason make mistakes they later regret. In a divorce situation often times one spouse decides they can afford to keep the home and purchase the other spouse out by giving them their share. Keeping the 3 or 4 bedroom marital home can be a financial company that neither party can absorb in the post divorce environment. Particularly with economic times the way they’re right now, the amount you purchase out your spouse for the time being might not be the same amount of equity you’ll get whenever you go to sell in a year or two.
A good Michigan divorce attorney will assist you decide whether it’s a good financial decision to buy the house. Home values are declining through the country and it’s never a bad idea to get your cash out from the marital home and after that downsize. If you wait to sell the house, your 50% of the equity could end up disappearing as the home value diminishes in a declining real property market. Maintenance and child support to the receiving parent can help fund the mortgage and taxes, but some parties find that the burden of keeping the marital home post divorce outweigh the benefits, especially in this current home market\/mortgage environment.
Clean separation of assets and debts is another difficult task, but one that has to be done. Throughout the divorce process it’s typically a roller coaster ride. You shouldn’t take a chance on your spouse to accumulate debt that could negatively affect your credit rating. Once a debt is reported to your credit bureau it’s very difficult and time intensive attempting to get it removed. Based on your former spouse to adhere to financial arrangements is also a big mistake. Even though both parties in a divorce are held to a court ordered divorce agreement, creditors aren’t bound by the terms of the divorce judgment.
In case your ex fails to pay on debts or loans, you might be suffer the implications when applying for future financing. In case the divorce procedures are going smooth you’d think you never need to worry, but all it can take is one argument and usually there are bitter emotions which could lead to one spouse not cooperating. You can avoid this by not depending on that spouse for any financial commitments unless it’s in writing. Forgetting to change your will and beneficiary forms. Wills and trusts may also be seriously impacted by divorce proceedings. Parties in divorce should separately seek counsel for the drafting and execution of new estate plans, reflecting the wishes of the maker of the will and\/or trust prior to the time of the divorce.