A divorce or separation can be a major emotional and financial setback for many Australian families. There are so many things to consider at this time and it is easy to become overwhelmed by such a big change in your life! One of the biggest considerations that couples need to consider is how to divide their finances.
Dividing assets and debt following a divorce can be a complex exercise. Couples have to list, identify and value all of their personal assets and debts including their family home. Sometimes couples are able to come to a financial agreement between themselves. Other times, they will need the Court to decide how assets are divided. It is always best to seek legal advice from your Cairns Lawyer before any financial agreement is made and finalised.
There is no set formula that the court follows in deciding how assets are divided when couples divorce. They will take a number of different considerations into account when making a decision...
- The court will look at all assets and debts that belong to the couple.
- The contributions that each person has made over time is considered.
- Each person’s future needs are also considered, particularly if those needs are not equal. For example where there is a significant income difference or one person is significantly older than the other.
- Lastly, a final percentage split is worked out.
The Family Home
If you and your spouse are going through a divorce and own a property in Cairns, there are a few options when it comes to deciding how to split the family home.
Buy the other person out
If you have been through a divorce, you may wish to remain in your family home, especially if you have children.
- Sometimes other assets such as superannuation, cars, investments, savings can be considered to even up the distribution.
- Alternatively, the sale of the house can be postponed until the children leave home or you remarry.
- Another option is to pay your spouse out and refinance your home loan in your name only. You will have to pass the lender's eligibility requirements and show that you are able to make the repayments on the home loan. The lender will be looking only at your assets, income, debts, and credit history, as the home loan will be in your name only. Removing your partner's name from a mortgage home loan can be complicated, and it is always best to seek legal advice from your Lawyer. Preston Finance can help you to find the best home loan with the lowest interest rate.
The property is sold and the proceeds are divided
If both parties agree to sell the family home, the property can be sold and the proceeds divided. How the proceeds are divided depends on a number of factors as mentioned above. Problems can arise if the property does not sell quickly or if you and your spouse cannot agree on a sale price. It is always best to seek advice from your Lawyer so that they can make sure your rights are protected at all times.
Preston Finance in Cairns can assist you when it comes to handling the financial matters following a divorce. If you need to refinance your home loan, we will do all the hard work for you and find the best home loan at the lowest interest rate.
Contact us today:
1/15 Spence St
07 4052 0750