3 Ways to Secure Your Finances Before Divorce

Posted February 15th, 2012 by Divorce Coach with No Comments

Posted by Scott David Stewart, Wednesday, February 15, 2012

Reaching the decision to file a do-it-yourself divorce is not something that you should rush into. While you’re mulling over the merits of your marital circumstances, however, you can certainly position yourself more securely by being pragmatic with your financial resources. Don’t allow emotions to obscure the need to protect your interests in advance of a potential divorce.

Before any petition for dissolution of marriage is forthcoming, implementing these three suggestions will help secure your current financial position:

ONE. Copy Every Financial Record.

You need a complete inventory of your financial records, all of them. Gathering and organizing your financial records is essential to protecting your rights to assets in the divorce while assuring that debts are fairly allocated, too.

You need to gather all of your bank information, credit card statements, estate plan instruments (Wills, trusts, and powers of attorney), mortgage documents, retirement accounts and pensions, safe deposit boxes, insurance policies, tax returns, stocks and bonds, and so on.

What are you going to do with all of this information? You’re going to scan or copy everything and store those copies in a secure location. Don’t sequester these important papers in the marital home should your access be restricted or your spouse seize, alter, or destroy them. Consider acquiring your own personal safe deposit box, one that your spouse cannot gain access to. You might also store your financial evidence with a trusted family member or close friend.

TWO. Set Aside Money for Legal Expenses.

Even if you decide to represent yourself in your divorce, you will still need money for expenses like court fees, a child custody evaluation, private investigator fees, mediation costs, and an independent legal opinion should the need arise. If you move out of the marital home, then you’ll also have substantial living expenses to manage. All too often, one party has control over the family finances and will use that as leverage for a favorable, yet inequitable, settlement.

Open your own bank account, one that your spouse does not have access to, and start setting money aside. Don’t open a new account in the same bank where you and your spouse have any accounts. Find a different bank and open a new account in your name – keep your spouse’s name off of the account. You’ll also need access to personal credit, so open a new credit card account in your name only. Again, do not add your spouse to the credit card account and do not allow him or her to make authorized charges to it. You should definitely consider leasing your own post office box so you know that your mail and new account information will not be intercepted by the other party.

THREE. Order Your Credit Report.

Requesting a copy of your and your spouse’s credit report is absolutely necessary for a complete financial picture. You want evidence of your credit history and you want to know what your credit score is. Acquiring your credit report is a simple method of tracking financial obligations and charges. It is the easiest way to monitor all financial activity affecting your accounts. You will see for yourself whether certain marital funds were wasted, perhaps on your spouse’s significant other. You will know whether your spouse is making large purchases that could impact the division of assets and debts in the divorce.

At the Law Offices of Scott David Stewart, we know that divorce is serious business. Don’t take unnecessary risks or bury your head in the sand when your financial future is at stake. You need to be proactive and take lawful action to secure your financial position before the divorce petition is filed. Positioning yourself securely with your finances will go a long way toward ensuring equal bargaining power in the division of assets and debts in your divorce.

DIY Divorce Resource:

Getting Started: 7 Must-Do Items for Divorce Planning

7 Tips to Reducing the Cost of Your Arizona Divorce

Property Division in Divorce – Transmute What?

Posted February 3rd, 2012 by Divorce Coach with No Comments

Recently, we discussed the division of marital property and debts in an Arizona divorce. Today, we’ll talk about transmutation of separate property – what it means and how it happens.

Before property can be divided in the divorce, the parties must designate all of the their assets and debts as either community property or separate property. Only community property is divided. The best place to start is to establish how, when, and where each asset was acquired. Doing so will tell you whether the property is yours, the other party’s, or shared property that must be equitably divided. Simple so far, right? Yes, simple, but not all non-marital property remains separate.

How do you designate an asset that started as one party’s separate property, but was so commingled during the marriage that it lost its characteristic independence? The answer lies in the rules of transmutation of separate property.

What Is Transmutation?

Transmuting property is changing that asset’s prior designation, which results in a change of legal ownership. The separate property of one party may be transmuted into the marital property of both spouses upon the occurrence of certain events.

What Transmutation Clues Should You Look for?

In your do-it-yourself divorce, you need to examine all of your assets and debts carefully and determine whether ownerships has changed since the item was first acquired. In Arizona, separate property transmutes into marital property in three distinctive ways:

1. By Gift. The owning spouse gifts it to the community. When one party owns a home prior to the marriage, for example, and later conveys the residence to both spouses as joint tenants, then this act is presumed to be a gift of separate property to the community. (This legal presumption of a gift, however, is rebuttable with clear and convincing evidence.)

2. By Agreement. Both spouses may agree between themselves that an asset that was separate property is now marital property, and vice versa. In other words, they may agree that their car is now her car; or that his bank account is now their bank account. As long as the agreement is voluntary and consensual, both parties will be held to it.

3. By Commingling. This occurs when one spouse’s separate property was so extensively mixed with the couple’s marital property that it completely lost its separate identity. One party’s funded bank account before the marriage may have been used by both spouses for years during the marriage, with deposits and withdrawals carried out by both. Commingling occurs often in marriages of long duration, although that is certainly not an absolute.

Designating an asset or obligation as either the separate property of one spouse, or the community of both spouses, can be quite complex. And depending upon the type of property at issue, quite confusing, such as a family business that started out as one party’s sole operation. If you have any misgivings about the characterization of a particular asset or debt in your divorce, spend a little money and get an opinion from an experienced Arizona divorce attorney before you agree to a property division. The cost is worth the price of certainty and peace of mind.

Are You Ready for an Arizona Parenting Conference?

Posted February 2nd, 2012 by Divorce Coach with No Comments

The Child Custody and Parenting Review Conference, or parenting conference, is yet another dispute resolution tool in the family court’s arsenal. The objective of the parenting conference is to assist the Court in determining what custody arrangement is in the best interests of the child.

The conference is not confidential because the family law judge can address any matters raised during the process. You’ll be pleased to learn, though, that no attorneys attend the conference. This not only levels the playing field when one party has an attorney and the other does not, it keeps the focus on the child where it belongs.

First of all, either party may request that a parenting conference be scheduled with a court-appointed provider by filing a written Motion for Parenting Conference. When the Court grants the motion request and orders the conference, you can expect these concerns to be addressed:

1. Where the child will reside.

2. How much time each parent will spend with the child.

3. How important decisions will be made for the child.

4. How day-to-day decisions regarding the child will be made.

Conciliation Services.

When the Court orders a parenting conference it refers the case to Conciliation Services which facilitates the conference. The entire evaluation process, from the Court’s referral to the conciliator’s final report, can take two months or longer, so try to be patient.

In preparation for the parenting conference, both parties typically complete an intake evaluation. Unless there are domestic violence concerns or an order of protection that is in place, the conciliator will meet with the parents together.

Recommendations from the Conciliator.

The purpose of the parenting conference is to arrive at a custody plan for the child that is in his or her best interests. When the parents are able to come to an agreement on some, or even all, of their child custody and parenting time issues, then the conciliator may (or may not) choose to recommend their agreement to the Court.

The conciliator’s report includes important custody information and recommendations, including the following:

1. Referral details that led to the evaluation through Conciliation Services.

2. Background information about the child and the family.

3. All areas of agreement that exist between the parties on child custody and parenting time.

4. All disputed issues that remain between the parties regarding child custody and parenting time.

5. Concerns from either parent regarding custody and visitation.

6. The conciliator’s assessments and impressions regarding child custody.

7. The conciliator’s conclusions and recommendations for the Court.

Once the report has been submitted to the Court and to both parties, a review hearing is usually scheduled.

If a parenting conference is likely to be a part of your Arizona DIY divorce, then set aside some time to read our articles on this very topic. You may want to start with The Role of the Parenting Conference in Settling Child Custody Issues.

Does Mediation Have a Place in Your Arizona DIY Divorce?

Posted February 1st, 2012 by Divorce Coach with No Comments

You’ve decided on a do-it-yourself Arizona divorce, but that doesn’t mean you and your spouse cannot avail yourselves of mediation to resolve issues. Mediation is a well-known and well-respected form of alternative dispute resolution (ADR) – that is to say, mediation is an alternative to the courtroom resolution of the parties’ disputes.

What Issues May Be Mediated?

One of mediation’s greatest benefits is that any legal issue can be presented for mediation. The divorce issue that the spouses seek assistance with – whether it involves child custody, child support, parenting time, visitation, spousal maintenance, or the division of marital property – is presented to a professional mediator. Presenting an issue for mediation and coming to an agreement on that issue are two different matters. In our experience, if the spouses are truly willing to try and work out an agreement, we have found that many, if not all, of the parties’ disputes can be successfully resolved through mediation. When you consider mediating a disputed issue in your divorce, make sure you understand the mediator’s role and the ADR process.

How Is Mediation Conducted?

The mediation is an attempt to settle disputed issues in the divorce before a trial and a judicial decision become necessary. When mediation does not yield an agreement on all of the issues, then the remaining disputes proceed to trial for the Court’s decision.

The mediator’s objective is to facilitate a voluntary agreement between the parties. This is a confidential process in which the mediator remains neutral – he or she does not advocate either party’s position. That may sound simple enough, but if the parties are incapable of remaining civil with each other when in the same room, the mediator utilizes other techniques to move the couple toward agreement, one such technique is known as caucusing (no, we’re not talking politics). In a mediation caucus, the parties are in separate rooms and the mediator caucuses back and forth between them in an effort to establish common ground and inch toward an agreement on the issue. You need to appreciate what a mediator cannot do, which is force or order either party to accept or concede to any terms.

Is Mediation Available Through the Superior Courts?

When there are minor children of the marriage and custody issues are involved, court mediation is available through the Superior Court’s Conciliation Services. For other issues, however, you’ll have to seek the services of a private mediator in your area.

At the Law Offices of Scott David Stewart, our divorce attorneys have prepared many of our clients for mediation. Mediation can be a very effective method of resolving disputes without the necessity of a trial. And when trial is avoided, costs are usually avoided as well. If this is something that you think might help you and your spouse come to terms on some or all of the issues in your divorce, then take a moment to read more about mediation on our website.

DIY Divorce Resource:

Dispute Resolution and Private Mediation

Preliminary Injunction in Your DIY Divorce

Posted January 30th, 2012 by Divorce Coach with No Comments

Trying to hide money and assets in a divorce is sadly typical, but a good attorney will find any sneaky hidden money stashes!

Are you representing yourself pro se in an Arizona divorce? Then be prepared for a preliminary injunction to go into effect when the case is initiated. When every Arizona divorce is filed, the family Court will order a preliminary injunction prohibiting both parties from doing certain things during the pendency of the case.

You need to fully understand all of the actions that are prohibited by the injunction, including the following:

1. You cannot hide your earnings or assets from the other party without violating the preliminary injunction. You may open your own separate bank account, though, and start depositing your wages and earnings into that new account. You should refrain from suddenly draining your “married” bank accounts to fund an account that your spouse cannot access.

2. You cannot take out any loans against community property without violating the preliminary injunction. Unless you have written consent from the other party, you are prohibited from selling or encumbering marital property. Exceptions may be made, however, when community property must be sold to pay for daily living expenses.

3. You cannot cancel certain insurance policies without violating the preliminary injunction. Once the injunction is in place, you cannot have your spouse or children removed from any insurance coverage. This prohibition extends to medical, hospital, dental, automobile, and disability insurance policies. So remember that both parties are required to maintain all insurance coverage in full force and effect.

4. You cannot remove your children from the state of Arizona without violating the preliminary injunction. Of course, this prohibition only affects children that are common to you both, and not children from a previous marriage or relationship. If you need to take the children out-of-state, then you need to have a prior written agreement from the other party or an order from the Court permitting you to do so.

When you represent yourself, you need to be diligent about protecting your rights. If you believe that your spouse has violated the Court’s preliminary injunction order, then you need to document what happened and take action. Violating the Court’s order can result in a finding of contempt of court, arrest, and prosecution for interfering with judicial proceedings, at a minimum.

Ready to Start Your Online Divorce Coach Subscription?

When you believe that the other party violated the Court’s preliminary injunction order, you may want to start your Online Divorce Coach to get direction on how to proceedOnce your subscription is activated, you can immediately being emailing your specific questions to the Online Divorce Coach.

How to Locate Hidden Assets in Your DIY Divorce

Posted January 29th, 2012 by Divorce Coach with No Comments

Now that you’ve decided on a do-it-yourself Arizona divorce, you need to understand, first, how marital assets and debts are divided. And second, how to go about looking for clues to any hidden assets in your divorce. As part of the discovery process of every divorce, the parties are required under Rule 49 to make full disclosures regarding their assets. When one party intentionally hides assets and undermines the property division in the divorce, then direct action must be taken to protect the other spouse’s property rights in those assets.

Does the Length of the Marriage Affect the Division of Marital Property?

How long you’ve been married may affect the quantity and quality of your marital property, but the duration of a marriage does not change the basic rule that marital assets and debts must be equally divided in a divorce. Each spouse is entitled to an undivided one-half interest in the community property. We do know, however, that the longer the marriage the more substantial the couple’s assets tend to be and, frequently, the more complex the division of those assets and debts will be in the divorce.

Do Some Parties Really Try to Hide Stuff in the Divorce?

In your do-it-yourself divorce, you need to recognize the possibility that there may be hidden assets. When we refer to hidden assets, we’re talking about marital property that has been concealed by one party to get an unfair advantage over the other spouse. It is very hard to ask for a marital share of an asset that you do not know even exists, so you need to be proactive in protecting your property rights.

You need to locate and identify any property secreted away by your spouse and get it before the Court for proper division. Concealing assets happens far too often, so don’t assume that your spouse hasn’t attempted to do the same. Some spouses will secret assets during the marriage, because that is their nature. Others are more likely to conceal assets in anticipation of a divorce. In our experience, we’ve found that the more time a spouse has before the divorce is filed, the more likely they are to hide assets from the other spouse.

2 Quick Tips for Finding Hidden Assets

1. Look for the decoy. A decoy is intended to divert your attention from something else. In the context of hidden assets in a divorce, a decoy (the easily found minimally funded bank account) is there to distract you from the big concealment (the heavily funded offshore account). If you find the decoy, strengthen your resolve and keep looking for the real hidden treasure.

2. Look to tax returns. If you carefully review the income tax returns (from your spouse if filed separately) for the past five years, you may very well find clues to hidden assets. First, compare the interest income schedule on the tax return with the accounts listed by the other party during discovery – do they match up? Second, does the mortgage interest and real estate tax reported in the federal tax return match up with the other party’s disclosure in the divorce? Third, will there be a tax refund issued because of a tax overpayment?

A spouse’s attempts to hide assets directly interferes with the Court’s division of marital property and debts in the divorce. If you find any clues or suspect hidden assets, then consider getting specific legal advice on how to proceed from an experienced divorce attorney. At the Law Offices of Scott David Stewart, we employ private investigators and forensic accountants to locate and identify hidden assets. We look into bank accounts, retirement benefits, real estate holdings, stocks and bonds, business revenues, and overseas assets to bring concealed assets before the court for proper division. In your do-it-yourself divorce, you need to be ready to dig for clues and take action to disclose the other party’s hidden assets.

DIY Divorce Resources:

How to Get a Copy of Your Federal Tax Return

How to Get a Copy of Your Arizona Tax Return

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