Marital property… Don’t let the term flummox you!
Marital property is a term used to refer to all assets acquired throughout the duration of the marriage. The duration of the marriage is calculated starting from the commencement of the marriage (which is the date that the couple was actually married) to its end (which is the date that the complaint for divorce was filed). Anything accumulated and/or otherwise acquired during that timeframe is called marital property.
For instance, let us assume you filed a complaint for divorce on January 1. On March 1, an item is purchased by either spouse. That is not marital property. However, if you dipped into your 401K and cashed it out after the complaint was filed, and you used that money to buy a diamond ring of some sort, that is still part of the marital property. It is important to note that marital property includes both property rights and obligations. Hence, assets and debts are both considered to be marital property.
Equitable distribution is the method used to divide this marital property. It does not imply that the property is divided equally (that is, 50-50). What it does imply is that the marital property is divided in a manner that the court believes is fair. The courts examine 16 different factors to determine how marital property is going to be divided. Let’s examine what these actually mean when it comes to specific parts of the marital property.
What Happens to Our House?
A house is not merely a structure beneath whose walls you sought shelter all your life. It is a home. It is the enduring witness of you’re the memories you created within its halls. There are so many beautiful stories etched into its walls… the story of your lives as a family, the story of your life as an individual… It is so much more than just wood, brick and stone.
Enter divorce and this silent sentinel of a house just gets chopped up like a piece of meat. Several people take offense to this ruthlessness. Some others feel emotionally distressed. What they do not understand is that the process of dividing marital property is complex, yet straightforward. However, it does not take into account which party wants the house. The judge will always try to rule in favor of what is fair.
Depending on who wants the house and who has the wherewithal to keep the house, there are only three possible outcomes.
- If Spouse A wants it: the husband buys the wife out, gets an appraisal, finds out how much equity is, writes a check and consequently refinances it. In this case, the wife moves out.
- If Spouse B wants it: The wife buys the husband out. She refinances the house, and the husband moves out.
- If they both it: If both parties want the house, the judge sells it. Equitable distribution can seem cold-hearted and cruel. But it is what is most fair.
If Spouse A wants the house and has the wherewithal to possess it, Spouse A gets the house. If, conversely, Spouse B wants the house, and has the wherewithal to buy out Spouse A, Spouse gets the house. However, if both want the house and it turns out that both are on an equal footing when it comes to their finances, neither Spouse A nor Spouse B get the house. The judge sells the house. Nobody ends up getting the house.
While this is ultimately what is most fair, there is an aspect that is truly terrible about the equitable distribution of marital property. If Spouse A has money, family money, friends, boyfriends, girlfriends, and Spouse B does not, Spouse A can come in and try to buy the house out from Spouse B, thereby ripping Spouse B’s emotional equanimity to shreds.
- Whoever has the financial wherewithal to buy the other out, gets the house.
- If both parties want the house and can afford to buy the other out, the judge sells the house.
What Happens to the Cars?
During a divorce, cars are equalized. What does that mean? Spouse A and Spouse B both own their own individual cars. If Spouse A owns a fancy new 2014 BMW and Spouse B drives a trusty old 1995 Honda Civic, the judge is going to equalize their values.
In this scenario, the 1995 Honda Civic may have no value whatsoever. Additionally, it is paid for. However, its value is not as high as the 2014 BMW’s. Let us assume that the BMW’s value is $1,000. This means that Spouse A would be able to sell the 2014 BMW and make $1,000. Spouse B is entitled to half of that amount, that is, $500. Spouse A and Spouse B both get to keep their cars. The values of both vehicles are equalized and Spouse B, whose car has no value, is entitled to half the value of the more expensive car.
- Both parties keep their cars while the values of both cars are equalized.
- The spouse whose car is of lesser value is entitled to half the value of their spouse’s car.
What Happens to My Personal Belongings?
When you are undergoing a divorce, it is essential to make a list of all your personal belongings. Go through your house, the living room, the attic, storage, and list any units that you may have. Make a comprehensive list and include two columns. One column is for you and the other is for your spouse. Mark an “X” for who each article and item belongs to. Some things are likely going to be easy to separate.
For instance, if you own two TVs and they are both reasonably comparable, then you want to separate them. There may be some things that have sentimental value or may have other value for emotional reasons that you want to keep. You want to break everything down. When it comes to personal items and belongings, always make a list.
- Make a comprehensive list of all personal items and effects.
- Separate the items between yourselves.
The office of Christopher Leon Garibian handles all matters pertaining to divorce. If you seek legal counsel, we encourage you to schedule an appointment with our office for a free initial consultation. Let us ease your way through this difficult time.
Christopher Leon Garibian, Esq. is a partner in the matrimonial and family law department of Weiner Law Group LLP. He has over 19 years of experience handling a multitude of Divorce and Family Law Matters throughout New Jersey. He is passionate about family law and takes pride in his ability to effectuate real change in the lives of his clients. He is certified by the State Supreme Court of New Jersey as a Matrimonial Attorney. If you are in need of an experienced Divorce Attorney or Family Law Attorney in NJ, contact us today for compassionate, long lasting legal solutions.