Q&A: Dividing the Marital Estate
Q: If my spouse and I get a divorce, who gets to stay in the house, and who has to leave?
A: Actually, both spouses have a right to stay in the house unless the Court says otherwise. Some separating couples choose to cohabitate until the divorce is finalized – this can provide financial savings for both parties, as well as a temporarily stable environment for any children in the household. On the downside, cohabitation can also create a stressful living situation for everyone involved, due to the stressful nature of living with an ex.
Should you decide against cohabitation, you might choose to either move out or have your spouse removed by filing for exclusive possession of your home. Exclusive possession is simply the right to live in the house while the divorce is being litigated. There are a variety of factors that go into a Court’s decision regarding exclusive possession, such as the comparative time spent with children and a party’s access to alternative housing. Keep in mind that retaining the house during the divorce proceedings has no effect on your financial interests when it’s time to divide marital assets.
Q: What does the Court take into account when evaluating the marital estate, and what can I expect from the division of assets?
A: Pennsylvania Courts rely on Equitable Distribution when determining the appropriate division of marital assets. Bear in mind that “equitable” is not the same thing as “equal” – an equal distribution would simply divide marital assets into a 50/50 split, while Equitable Distribution is based on overall fairness. The Court examines factors such as the parties’ respective ages, work histories, education, and earning capacities. For example, a stay-at-home dad with minimal work experience is likely to walk away with a greater share of marital assets than his business executive of an ex-wife.
The Court decides whether or not an asset is marital, and consequently subject to division, by looking into its intended use and served purpose. Property is considered marital if it was purchased during the marriage, and/or if either spouse can prove that he or she invested resources of any kind into its purchase, maintenance, or improvement – this may be in the form of money, manual labor, or even day-to-day care.
Q: How are inherited properties and/or assets divided?
A: The Court divides inherited property and assets based on the original intentions of the former spouses. If a spouse has previously placed inherited funds into a joint account, or has used them for marital purposes, such as maintenance of the marital home, the Court can deem those assets to be marital. By contrast, any assets put into an account solely titled in the name of a single spouse, or in trust for the benefit of themselves or their children, would not, generally be considered as a part of the marital estate. However, even if an inherited property or asset is deemed to be non-marital, it may still significantly impact the final marital division. For example, a lesser-earning spouse is generally entitled to a greater share of marital assets, but if the Court finds that he or she is in possession of a substantial non marital inheritance, the Court may factor that into its determination regarding his or her need.
Q: What are the different kinds of financial support involved during a divorce?
A: All types of support, barring child support, are intended to keep an even playing field for both spouses. The first type of support is spousal support, which begins from the date of separation. Spousal support is based on need and can be refused to a party who has been found guilty of fault, abandonment, cohabitation, abuse, etc. Once divorce has been filed, support can transition into Alimony Pendente Lite (APL) which runs generally until a decree is entered. The final form of marital support is Alimony. PA Courts do not hand out alimony as generously as in other states, and even when granted, alimony is usually awarded only for a certain period of time.
Child support, unlike marital support, is based on the combined parental income. Both parents are expected to contribute; the amount ordered varies based on the respective parent’s percentage of the combined income.
Q: What should you do to keep track of your assets and liabilities?
A: I often urge my clients to be as organized as possible. As the Divorce progresses the parties will need to provide proof of the value of the assets and liabilities. A client who delivers a box of disorganized paperwork is only increasing the number of billable hours that they’ll be paying for in the end. You might also consider downloading and saving statements on a regular basis, since banks don’t keep those on record for as long as they used to. For those who have not yet separated from their spouses, I recommend copying all of the important documents and financial records in the home. Those copies ought to be kept in a secure location, either electronically or physically or both.
Most Divorce attorneys will have some form of inventory software or questionnaire to ensure that clients don’t forget important assets or liabilities. If your spouse is in possession of any important documents, don’t worry, your attorney can get copies of those through the discovery process either with a discovery order from the Court, interrogatories, or requests for production of documents. Again, when the client can provide the documentation him or herself, it can result in a significant savings in legal fees.
Jordan Reilly & Associates, LLC
210 W. Front St.
Media, PA 19063
(610) 400 - 1968