Divorce and loans

[user19000 18]

Hi,

I have this question. We live in Pennsylvania. My spouse bought the house prior to the marriage, all paid for upfront. During the marriage my spouse doesn't put my name on the house title; yet, my spouse took a loan of 200 hundred dollars against the house to invest in a business. Though I help run the business, I don't benefit from the profits it yields (my spouse keeps all their money separately and even doesn't use it for our everyday life). I am new in this country and I don't know anything about property ownership or loans.

Some people told me that in PA, if a couple get divorced all the property as well as loans acquired during marriage is called marital property and will be divided equitably.

I never want to get divorced and have been struggling to save the marriage. Yet, at the rate we are going, it seems inevitable, just a matter of timing. I am afraid that if we really get divorced I will be "awarded" half of the $200,000 loan. I don't care about getting half of my spouse's income. Supposed it does work that way then half of the income acquired during a two-year-short marriage won't help balance things out.

What do you guys think? I'd appreciate any input.

Thank you.

[Villanelle 4,122]

Some people told me that in PA, if a couple get divorced all the property as well as loans acquired during marriage is called marital property and will be divided equitably.

You seem to be misunderstanding the word "equitably". It does not mean equal or half. It means it shall be divided in an equitable fashion. Equitable does not mean equal, but rather what is fair.

Whats fair is going to based on a lot of things including:

1. The length of the marriage.

2. Any prior marriage of either party.(if you have alimony from that)

3. The age, health, amount and sources of income, skills, employability, and needs of each spouse

4. The contribution of each spouse

5. The opportunity of each spouse in the future for income.

6. The sources of income of both parties, including medical, retirement, insurance or other benefits.

7. The contribution or dissipation of each party in the acquisition, preservation, depreciation or appreciation of the marital property, including the contribution of a party as homemaker.

8. The value of the property set apart to each party.

9. The standard of living of the parties established during the marriage.

10. The economic circumstances of each party, including Federal, State and local tax ramifications, at the time the division of property is to become effective.

11. Whether the party will be serving as the custodian of any dependent minor children.

Debts are going to be divided in a fair manner. If one spouse owned real estate before the marriage, like your wife did, and it has increased in value during the marriage, the increase in value is a marital asset which the court must consider.

Of course you and your spouse do not have to go through all this. You can submit your own divorce settlement and divide your assets and debts between yourself and the court will grant you a divorce with a settlement agreement where you decided how things were divided. The court only gets involved and decides how to divide assets and debt if you ask them to (if you guys cant decide amoungst yourselves and you need them to get involved. Then it will be divided equitably.)

Your wife may be willing to do a settlement rather then let the court decide. If the homes value went up, the court may decide that you are entitled to a share of that equity, they may also decide that the loan is all on her. In that scenario she would lose by letting the court decide.

If the homes value went down however, she may want to let the court decide whats fair. She may be able to convince the court that the loan is not all hers and they may shift some of the burden on to you.

I really dont know what kind of proof you have that the loan totally went to the business and you got zero benefit from it. I dont know how many of the numbered items you have in your favor above that would make them say its unfair to burden you with the debt and more fair to have her keep the debt.

I think that if the debt went to the business and she still maintains an income off the business and you do not, most likely if the court rules on it, they will leave the debt with the business and not assign it to you.

[user19000 18]

You seem to be misunderstanding the word "equitably". It does not mean equal or half. It means it shall be divided in an equitable fashion. Equitable does not mean equal, but rather what is fair.

Whats fair is going to based on a lot of things including:

1. The length of the marriage.

2. Any prior marriage of either party.(if you have alimony from that)

3. The age, health, amount and sources of income, skills, employability, and needs of each spouse

4. The contribution of each spouse

5. The opportunity of each spouse in the future for income.

6. The sources of income of both parties, including medical, retirement, insurance or other benefits.

7. The contribution or dissipation of each party in the acquisition, preservation, depreciation or appreciation of the marital property, including the contribution of a party as homemaker.

8. The value of the property set apart to each party.

9. The standard of living of the parties established during the marriage.

10. The economic circumstances of each party, including Federal, State and local tax ramifications, at the time the division of property is to become effective.

11. Whether the party will be serving as the custodian of any dependent minor children.

Debts are going to be divided in a fair manner. If one spouse owned real estate before the marriage, like your wife did, and it has increased in value during the marriage, the increase in value is a marital asset which the court must consider.

Of course you and your spouse do not have to go through all this. You can submit your own divorce settlement and divide your assets and debts between yourself and the court will grant you a divorce with a settlement agreement where you decided how things were divided. The court only gets involved and decides how to divide assets and debt if you ask them to (if you guys cant decide amoungst yourselves and you need them to get involved. Then it will be divided equitably.)

Your wife may be willing to do a settlement rather then let the court decide. If the homes value went up, the court may decide that you are entitled to a share of that equity, they may also decide that the loan is all on her. In that scenario she would lose by letting the court decide.

If the homes value went down however, she may want to let the court decide whats fair. She may be able to convince the court that the loan is not all hers and they may shift some of the burden on to you.

I really dont know what kind of proof you have that the loan totally went to the business and you got zero benefit from it. I dont know how many of the numbered items you have in your favor above that would make them say its unfair to burden you with the debt and more fair to have her keep the debt.

I think that if the debt went to the business and she still maintains an income off the business and you do not, most likely if the court rules on it, they will leave the debt with the business and not assign it to you.

Thank you for explaining to me.

If I had a share in the debt I would of course be happy to take some of the burden. Thing is though we've been married for two years I still know almost nothing about my spouse's finances. They keep it a secret from me. They owned this business even before I came here. My spouse asks me to help them, and I do help them with whatever I can in running the business. Yet, when it comes to money they keep it completely to themselves. They went to the bank and took the loan by themselves, and didn't talk to me about it, until later when they asked me to help with some paperwork.

It would be really really unfair for me to have to be responsible for their debt.

Edited February 10, 2013 by user19000

[del-2-5-2014 1,339]

They?

[user19000 18]

They?

If you don't have anything helpful to say then just go get a life and leave me alone.

Thank you in advance for not coming back in my thread.

[VanessaTony 3,567]

They?

The OP is deliberately using non-gender specific terms to protect their identity.

[user19000 18]

The OP is deliberately using non-gender specific terms to protect their identity.

I didn't mean to sound aggressive, Vanessa&Tony, but Gowon seems to come here on this immigration forum just to pick holes in whatever people say and pick fights. I've seen enough of his posts to notice that.

Edited February 10, 2013 by user19000

[Villanelle 4,122]

I kinda noticed genders were missing and then for some reason decided to assign the word wife rather then keep typing spouse because it was getting confusing. Im not from that state and most of the example I could find about property and debt distributions obviously referred to husband and wife and to try to convert that to spouse and spouse was making me nuts so I made it wife and OP. (Now looking at it- I couldve just went with spouse and OP- )

But to the OP- It doesnt matter who you are- the wife or the husband. The court doesnt give preferential treatment to either. If it comes down to the court dividing things- it doesnt matter why the marriage broke up (things like adultery) it doesnt matter who imitated the divorce. It doesnt matter how either of you personally treated each other during the marriage.

What you do need to do-

Find out if you qualify for legal aid in your area. Do this even if you think divorce may be looming. Legal aid may or may not be available to you. Find out as soon as possible so you know if its an option or you have to cross it off your list and know you need to save money for a prvt lawyer. Legal aid can be considered a 'means tested benefit' in some states/counties. LPRS can be barred from receiving it. It depends on whos funding it. Different legal aid agencies get funding from different sources. Depending on exactly where you live, you may be eligible. You simply google your county name +legal aid and you will find the website for legal aid. They should have a contact form you can fill out or a phone number for info. I believe if you are initiating divorce proceedings they put you on a waiting list for an attorney if you qualify and its a rather long wait, but if you are served with divorce papers and you qualify for assistance an attorney becomes available to you immediately for assistance. (if you dont qualify, at least you know now, and you know youll either have to find the funds for a prvt lawyer or do this yourself)

You should then contact a Realtor in your area to find out if the home has any equity in it that you would be entitled to. These are obviously inflated numbers because no home goes up this much, but if the home was valued at 100k when you were married and now its worth 150k, the difference is 50k. According to PA divorce laws, you are entitled to a fair share of 50k. (your fair share is based on the list above or whatever you and your spouse agree to prvtly in a settlement). Only a Realtor can tell you how much the home has increased in value if any. So you can go online to a local realty website. Youre asking them to do something for free, so dont expect them to get back to you quickly. I would send an general email inquiry, although you could contact them by phone. Explain youre getting a divorce and would like to know what the market value was on the home (give the address) on the date you were married and the present value today. Since they are PA realtors, they know the divorce laws, they probably get asked for this a lot. They dont need to come to the home. Whenever someone sells a home, all the info is stored in a computer forever. its got the room sizes, layout, property size, tax info- so they can do this for you. You dont need to be the owner of the property to ask for this. (although I wouldnt mention this is my spouses property Im not the official owner) Just get the information for your own knowledge right now. Whatever the increase in equity was- know that you are entitled to your fair share of it under the law. (keep the realtors contact info because you will need that info printed on a letter head as proof of the amount if it does have to go to court to be divided fairly)

Again for the massive debt- if you can show you had nothing to do with the acquiring of the debt- it was for their business and not a marital debt, it should have anything to do with the divorce. I dont know what this means "until later when they asked me to help with some paperwork" Does that mean you helped them with business paperwork? Like here honey I just came home from the bank and took out a loan and now I need you to file this and print this out so I can sign it. Or are we talking here honey you need to sign this because I took out a loan and it needs signatures.

If you were just doing general paperwork assisting them with their business thats not you acquiring a debt. Especially if it was after the fact. If it was a joint project, you accompanied them to the bank, you researched loans together, you made the decision to invest in the business- then okay. But then your spouse would also be saying the business is a joint asset and would have to divide the business. They cant divide the debt for the business and not the business. (theyd have to 'buy you out' of the business in that case)

They could attempt to say the debt was not for the business and was for the home (in which case I suggest you get get copies of whatever documents you have access to that state it was for the business now before things get ugly and you no longer have access to them and put them in a safe place- you can upload them as mail attachments in a draft email that way theres no USB to get lost) Because if they were able to convince the court the debt was a home debt, it would be divided- so dont get caught there.

Again, I really dont know all your specifics. Im just running through possible scenarios. I hope everything works out for you.

Statistics show when things break down, it gets ugly. So the best thing to do is, when you sense its going in a bad direction- make copies of relevant things when you can. Put them in a safe place. Plan ahead for the worst. Research the laws and know what youre entitled to. You dont have to walk away with everything youre entitled to, but rather with what youre comfortable with.

[del-2-5-2014 1,339]

The OP is deliberately using non-gender specific terms to protect their identity.

I see.

The use of they threw me off as I thought it implied plural. The story makes sense now.

Thanks.

[del-2-5-2014 1,339]

I kinda noticed genders were missing and then for some reason decided to assign the word wife rather then keep typing spouse because it was getting confusing. Im not from that state and most of the example I could find about property and debt distributions obviously referred to husband and wife and to try to convert that to spouse and spouse was making me nuts so I made it wife and OP. (Now looking at it- I couldve just went with spouse and OP- )

But to the OP- It doesnt matter who you are- the wife or the husband. The court doesnt give preferential treatment to either. If it comes down to the court dividing things- it doesnt matter why the marriage broke up (things like adultery) it doesnt matter who imitated the divorce. It doesnt matter how either of you personally treated each other during the marriage.

What you do need to do-

Find out if you qualify for legal aid in your area. Do this even if you think divorce may be looming. Legal aid may or may not be available to you. Find out as soon as possible so you know if its an option or you have to cross it off your list and know you need to save money for a prvt lawyer. Legal aid can be considered a 'means tested benefit' in some states/counties. LPRS can be barred from receiving it. It depends on whos funding it. Different legal aid agencies get funding from different sources. Depending on exactly where you live, you may be eligible. You simply google your county name +legal aid and you will find the website for legal aid. They should have a contact form you can fill out or a phone number for info. I believe if you are initiating divorce proceedings they put you on a waiting list for an attorney if you qualify and its a rather long wait, but if you are served with divorce papers and you qualify for assistance an attorney becomes available to you immediately for assistance. (if you dont qualify, at least you know now, and you know youll either have to find the funds for a prvt lawyer or do this yourself)

You should then contact a Realtor in your area to find out if the home has any equity in it that you would be entitled to. These are obviously inflated numbers because no home goes up this much, but if the home was valued at 100k when you were married and now its worth 150k, the difference is 50k. According to PA divorce laws, you are entitled to a fair share of 50k. (your fair share is based on the list above or whatever you and your spouse agree to prvtly in a settlement). Only a Realtor can tell you how much the home has increased in value if any. So you can go online to a local realty website. Youre asking them to do something for free, so dont expect them to get back to you quickly. I would send an general email inquiry, although you could contact them by phone. Explain youre getting a divorce and would like to know what the market value was on the home (give the address) on the date you were married and the present value today. Since they are PA realtors, they know the divorce laws, they probably get asked for this a lot. They dont need to come to the home. Whenever someone sells a home, all the info is stored in a computer forever. its got the room sizes, layout, property size, tax info- so they can do this for you. You dont need to be the owner of the property to ask for this. (although I wouldnt mention this is my spouses property Im not the official owner) Just get the information for your own knowledge right now. Whatever the increase in equity was- know that you are entitled to your fair share of it under the law. (keep the realtors contact info because you will need that info printed on a letter head as proof of the amount if it does have to go to court to be divided fairly)

Again for the massive debt- if you can show you had nothing to do with the acquiring of the debt- it was for their business and not a marital debt, it should have anything to do with the divorce. I dont know what this means "until later when they asked me to help with some paperwork" Does that mean you helped them with business paperwork? Like here honey I just came home from the bank and took out a loan and now I need you to file this and print this out so I can sign it. Or are we talking here honey you need to sign this because I took out a loan and it needs signatures.

If you were just doing general paperwork assisting them with their business thats not you acquiring a debt. Especially if it was after the fact. If it was a joint project, you accompanied them to the bank, you researched loans together, you made the decision to invest in the business- then okay. But then your spouse would also be saying the business is a joint asset and would have to divide the business. They cant divide the debt for the business and not the business. (theyd have to 'buy you out' of the business in that case)

They could attempt to say the debt was not for the business and was for the home (in which case I suggest you get get copies of whatever documents you have access to that state it was for the business now before things get ugly and you no longer have access to them and put them in a safe place- you can upload them as mail attachments in a draft email that way theres no USB to get lost) Because if they were able to convince the court the debt was a home debt, it would be divided- so dont get caught there.

Again, I really dont know all your specifics. Im just running through possible scenarios. I hope everything works out for you.

Statistics show when things break down, it gets ugly. So the best thing to do is, when you sense its going in a bad direction- make copies of relevant things when you can. Put them in a safe place. Plan ahead for the worst. Research the laws and know what youre entitled to. You dont have to walk away with everything youre entitled to, but rather with what youre comfortable with.

Most excellent read, well laid out. Should be a sticky.

[user19000 18]

I kinda noticed genders were missing and then for some reason decided to assign the word wife rather then keep typing spouse because it was getting confusing. Im not from that state and most of the example I could find about property and debt distributions obviously referred to husband and wife and to try to convert that to spouse and spouse was making me nuts so I made it wife and OP. (Now looking at it- I couldve just went with spouse and OP- )

But to the OP- It doesnt matter who you are- the wife or the husband. The court doesnt give preferential treatment to either. If it comes down to the court dividing things- it doesnt matter why the marriage broke up (things like adultery) it doesnt matter who imitated the divorce. It doesnt matter how either of you personally treated each other during the marriage.

What you do need to do-

Find out if you qualify for legal aid in your area. Do this even if you think divorce may be looming. Legal aid may or may not be available to you. Find out as soon as possible so you know if its an option or you have to cross it off your list and know you need to save money for a prvt lawyer. Legal aid can be considered a 'means tested benefit' in some states/counties. LPRS can be barred from receiving it. It depends on whos funding it. Different legal aid agencies get funding from different sources. Depending on exactly where you live, you may be eligible. You simply google your county name +legal aid and you will find the website for legal aid. They should have a contact form you can fill out or a phone number for info. I believe if you are initiating divorce proceedings they put you on a waiting list for an attorney if you qualify and its a rather long wait, but if you are served with divorce papers and you qualify for assistance an attorney becomes available to you immediately for assistance. (if you dont qualify, at least you know now, and you know youll either have to find the funds for a prvt lawyer or do this yourself)

You should then contact a Realtor in your area to find out if the home has any equity in it that you would be entitled to. These are obviously inflated numbers because no home goes up this much, but if the home was valued at 100k when you were married and now its worth 150k, the difference is 50k. According to PA divorce laws, you are entitled to a fair share of 50k. (your fair share is based on the list above or whatever you and your spouse agree to prvtly in a settlement). Only a Realtor can tell you how much the home has increased in value if any. So you can go online to a local realty website. Youre asking them to do something for free, so dont expect them to get back to you quickly. I would send an general email inquiry, although you could contact them by phone. Explain youre getting a divorce and would like to know what the market value was on the home (give the address) on the date you were married and the present value today. Since they are PA realtors, they know the divorce laws, they probably get asked for this a lot. They dont need to come to the home. Whenever someone sells a home, all the info is stored in a computer forever. its got the room sizes, layout, property size, tax info- so they can do this for you. You dont need to be the owner of the property to ask for this. (although I wouldnt mention this is my spouses property Im not the official owner) Just get the information for your own knowledge right now. Whatever the increase in equity was- know that you are entitled to your fair share of it under the law. (keep the realtors contact info because you will need that info printed on a letter head as proof of the amount if it does have to go to court to be divided fairly)

Again for the massive debt- if you can show you had nothing to do with the acquiring of the debt- it was for their business and not a marital debt, it should have anything to do with the divorce. I dont know what this means "until later when they asked me to help with some paperwork" Does that mean you helped them with business paperwork? Like here honey I just came home from the bank and took out a loan and now I need you to file this and print this out so I can sign it. Or are we talking here honey you need to sign this because I took out a loan and it needs signatures.

If you were just doing general paperwork assisting them with their business thats not you acquiring a debt. Especially if it was after the fact. If it was a joint project, you accompanied them to the bank, you researched loans together, you made the decision to invest in the business- then okay. But then your spouse would also be saying the business is a joint asset and would have to divide the business. They cant divide the debt for the business and not the business. (theyd have to 'buy you out' of the business in that case)

They could attempt to say the debt was not for the business and was for the home (in which case I suggest you get get copies of whatever documents you have access to that state it was for the business now before things get ugly and you no longer have access to them and put them in a safe place- you can upload them as mail attachments in a draft email that way theres no USB to get lost) Because if they were able to convince the court the debt was a home debt, it would be divided- so dont get caught there.

Again, I really dont know all your specifics. Im just running through possible scenarios. I hope everything works out for you.

Statistics show when things break down, it gets ugly. So the best thing to do is, when you sense its going in a bad direction- make copies of relevant things when you can. Put them in a safe place. Plan ahead for the worst. Research the laws and know what youre entitled to. You dont have to walk away with everything youre entitled to, but rather with what youre comfortable with.

Thank you for taking your time to help me with the information, Capri!

Edited February 11, 2013 by user19000