After the breakdown of a marriage or de facto relationship. who gets what? It’s often the biggest issue on the table.
Very often it comes down to the big question – “Can I keep the home?”
The issue is fraught with emotion. People become very attached to their home, and the thought of a forced sale is hard to bear.
Certainly there are often good economic reasons to hang on to the home. The loss of a home can involve a huge loss of capital and reduction of living standard. Afterwards, there may be the extra cost of rent, and the inconvenience of moving a considerable distance away, with the all difficulties and dislocation this involves.
In considering all this, the Family Court gives the person with the greatest need access to the home, and encourages this person to buy out the other person’s share. But if the money can’t be raised to buy out the other party, then the Court may order a forced sale. The same considerations apply to farms and businesses – the fact which may have been in a family for generations makes no difference.
This is where lawyers can help, by bringing additional options and possibilities to the table in negotiations. Perhaps an agreement can be reached to defer the sale of the home for a period, until children finish school and a party gets back on his or her feet financially, for example. Perhaps superannuation entitlements can be accessed or an early inheritance negotiated to raise funds. Perhaps one of the parties is willing to make a financial sacrifice in the short term, and refrain from selling the home, to assist the children and his or her relationship with them, particularly if this will be mutually beneficial for everyone in the long run.
In family law, there is a basic four-step process in determining property settlement. Firstly, all assets of both parties are assessed and valued. Secondly, each party’s contribution is calculated as a percentage of the total assets. Thirdly the future needs of the parties are taken into consideration and an adjustment made, based on the need to the care for children and the disparity in income and earning capacities between the parties. Finally, a formal agreement is made between the parties. Once they reach an agreement, the parties enter into Consent Orders which are filed at the Court and the agreement is formalised. Such Orders often include an agreement for one party to retain the home, or to transfer it from joint ownership to single ownership without stamp duty being incurred on the transfer.
Most people are able to work out a sensible and fair solution within this four-step framework without too much difficulty – especially if they have help from experienced and constructive family lawyers.