What are Some Key Terms in a Marital Settlement Agreement?
While getting divorced is a legal process, most divorces do not actually go through the courts. In most cases, divorcing spouses are able to come to terms without asking a judge to make decisions for them, and then finalizing their divorce is simply a matter of obtaining the court’s stamp of approval.
When spouses negotiate or mediate the terms of their divorce out of court, these terms are put into a binding contract called a Marital Settlement Agreement. Some of the key terms in a Marital Settlement Agreement include the following:
1. Division of Community Property
Under Texas’s community property law, with only a few specific exceptions, any property that spouses acquire during their marriage will be subject to division in their divorce. This includes cash, bank accounts, retirement and investment accounts, real estate and items of personal property. Regardless of whether you and your spouse agree to a 50/50 split or some other “just and right” division of your marital estate, your Marital Settlement Agreement should clearly identify the assets that you and your spouse are each entitled to keep after your divorce.
2. Allocation of Debts
In broad terms, debts receive similar treatment to community property in a Texas divorce. All Marital Settlement Agreements should include clear provisions establishing liability for the spouses’ debts, including mortgages, car loans and outstanding credit card balances. However, it is important to note that a Marital Settlement Agreement will not override the terms of an existing loan agreement; so, if you and your spouse are listed as joint debtors on your mortgage, this is an issue that you will need to address separately as part of your divorce.
3. Payment of Spousal Support
If you or your spouse is entitled to spousal support (commonly known as “alimony”), your Marital Settlement Agreement will need to clearly address the amount, duration and payment schedule for alimony as well.
4. Custody, Visitation and Child Support
Child custody (referred to as “conservatorship” in Texas), visitation and child support are issues that are subject to stringent legal standards. When negotiating or mediating the terms of a Marital Settlement Agreement, it is critical to ensure that all child-related provisions meet both parents’ needs and satisfy the necessary requirements.
5. Other Key Substantive and Legal Terms
Depending on the spouses’ respective personal, financial and family circumstances, other issues that may need to be resolved in their Marital Settlement Agreement include:
· Child-related expenses not covered by child support (such as college costs)
· Health insurance and healthcare expenses
· Method of resolution for post-divorce disputes
· Ownership of pets
· Ownership of a privately-held business
· Retirement account distributions
· Special circumstances involving conservatorship and visitation (e.g., vacations, unavailability due to work conflicts, and children’s birthdays)
· Tax liability
When getting divorced, it is critical to ensure that your Marital Settlement Agreement is as thorough as possible. Overlooking assets, debts and other issues can lead to costly and contentious disputes down the line. The divorce lawyers at Nordhaus Walpole PLLC provide experienced legal representation for divorcing spouses in McKinney, TX and the surrounding areas. If you would like to speak with one of our attorneys about your divorce, please call (214) 726–1450 or request a free consultation online today.