2022 brought with it a series of unprecedented changes in the way that we live globally as well as personally. Annual inflation was at a record high which had detrimental consequences for many such as an increase in interest rates and in turn mortgages, the cost of food and living generally, and this is expected to continue to rise through 2023.
So what does mean for you if you are considering a divorce or separation?
Once you have begun the divorce/separation process the next step is a financial settlement. In order to achieve this, full and frank disclosure is required. This means agreeing a value for all assets shared jointly with your partner and separately. These figures will be updated throughout the process to ensure that they remain accurate while negotiations take place. This means they will accurately reflect what they are worth in the current market. Due to the instability of the market, it is recommended that a settlement is agreed in terms of percentages rather than a set value.
In the 2008 market crash the family courts made it clear that the financial crash was not sufficient justification to re-open cases and re-draw orders and therefore it is highly recommended you seek professional legal advice to ensure your negotiations and proposals are fair in the current climate.
An asset which is often disputed in financial cases is the family home. The current climate has had an immense impact on mortgage rates and an effect the housing market. The ability to purchase a home and reasonable housing needs are factors that are considered by the courts. With mortgage rates rising it is becoming increasingly difficult for separating couples to purchase property and therefore this must be taken into account when agreeing a final settlement.
Additionally, if one party’s income is significantly greater than the other’s, the need for spousal maintenance may arise. The Court will assess the amount of maintenance that they grant based on the needs of both the recipient and the payer. It is, therefore, crucial that income needs schedules are completed accurately to account for the increase in the cost of living. This is to ensure that any agreement reached now is also suitable for the future. If these schedules are not completed accurately, it is likely that the agreement reached now will not meet your future needs and this may lead to further applications, increasing legal costs.
At Wrigley Claydon we understand the need for a suitable financial settlement that takes into account both present and future needs. If you require any assistance, please do not hesitate to contact one of our highly experienced solicitors on 0161 624 6811 or email firstname.lastname@example.org.
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