financial planning - Page 3

Divorce and Private Equity: Hedge Funds & Headaches
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Divorce and Private Equity: Hedge Funds & Headaches

Published on
Nicola Harries
Nicola Harries
Partner & Head of Family
Stevens & Bolton

The financial consequences and processes of divorce can be baffling even when the parties’ assets are reasonably straightforward. Lawyers are prone to using jargon and acronyms that are entirely unfamiliar to the lay client. Where the financial assets include private equity or hedge fund investments, the degree of complexity and jargon increases exponentially.

For those who do not work in the world of private equity, the investment structures and how they work are often entirely alien concepts. Those who do work in that world are so familiar with it that they struggle to explain those concepts to the uninitiated. This can leave a divorcing spouse feeling completely lost; the gradient on their learning curve becomes significantly steeper.

Matrimonial and Non-Matrimonial: To Share or Not To Share

For long marriages, courts will look to equally share the value of wealth accumulated by a couple during the marriage. However, where possible, a non-sharing approach will be taken to wealth brought into the marriage, wealth created after the marriage and inherited wealth.

Broadly, it is considered fair that a party should be able to keep the benefit of the wealth they create after separation because it’s attributable to effort made after the marriage has ended.

Therefore, whilst the capital and pension assets accumulated during a marriage are likely to be shared, future income will not. Income (or maintenance) orders are assessed against ongoing income needs.

Things are seldom clear cut; bonuses are often paid in the financial year after they were earned. A bonus received in the first year of separation is quite likely to have been referable to work undertaken in the final year of the marriage. Marriages don’t break down on schedule, so there is scope for argument where a marriage breaks down partway through the financial year against which a bonus is judged.

With private equity investments, the lines can blur where matrimonial wealth is invested in long running funds which may not pay off for many years after a marriage is over.  An additional complication arises as the structure of these funds means that future payments cannot be clearly said to be either capital or income – so what approach is the court to take?

Private Equity Fund Structure

Managers establish a fund and over time raise funds for investment. A management fee is charged for the funds under investment. As many of these funds are worth hundreds of millions of dollars, the management fees themselves can be significant.

The fund managers are usually required to co-invest in it, demonstrating that they have ‘skin in the game’, albeit usually at much lower levels than the institutional investors they attract.

Investments are then made in carefully chosen businesses, with the aim that these will be built up and sold at a profit over the lifetime of the fund, on average a period of 8-10 years.

A hurdle rate is set for the fund; this is the minimum return that must be achieved for the investors before the fund managers can share in any additional profit created. The entitlement to share in that surplus profit is known as ‘carry’. Not every fund’s return will exceed the hurdle rate so the amount of carry is inherently uncertain.

Co-Invest and Carry Upon Divorce

Co-invest

Usually, but not always, co-invested fund managers will share in the carry. However, in some funds managers can be entitled to share in the carry without having invested. Establishing the detail is key; if the co-invested funds emanate from matrimonial sources they would be shareable, albeit the sharing of that value may be deferred until the fund makes distributions. These often occur when an underlying business is sold.

Carry

The entitlement to share in the carry is far more complicated. To understand how the court approaches this, you must ascertain:

  • the degree of involvement a fund manager has had after the fund has been invested;
  • the dates the fund was established and the date on which the ‘close’ occurred – namely the point when all funds had been raised.

Continuing involvement with the fund

Not all private equity funds are invested in the same way. Whilst some funds invest directly into underlying companies, others invest in larger private equity funds which make those direct investments.

For the former, fund managers will be actively involved with the underlying companies invested in.

For the latter, often known as ‘funds of funds’, managers will decide upon the best fund(s) to invest in but will not be involved in the ongoing management of the underlying investments.  Whilst it requires skill to select the right fund, once the choice is made, the ‘fund of funds’ manager’s involvement is minimal compared to the manager who remains directly involved with the development of the underlying companies.

Using the principles above to reflect post-marital effort, the court could consider that once the ‘fund of funds’ investment is made, the investment return is attributable to the efforts of others and that any returns of co-invest or carry entitlement flowing from the performance of the ‘fund of funds’ should be shared.

Where the divorcing spouse is the actively involved fund manager, the development of the underlying companies can be argued to be a direct result of their ongoing efforts during the lifetime of the fund. In that case, the court will calculate and share the element of carry that is matrimonial.

That is assessed by reference to the period from establishment of the fund to the date of trial, taken as a proportion of the expected term of the fund from the date of close. For example, in the case of A v M [2021], the period between establishing the fund and the trial was 60 months. The period from close to the expected end of term for the fund was 113 months. The judge decided therefore that 53% (60/113) of the carry should be shared equally between the parties, with the fund manager retaining for themselves the remaining 47% to reflect the work they would do over the remaining term of the fund.

Specialist Advice and Drafting

For the large funds, the divorce of an individual whose investment is minimal compared to the overall fund size means that the parties have very limited power to call for the return of funds.  Unless one party is prepared to offset other assets to pay off their spouse sooner, they must usually wait for the fund to run its course before funds are received. As investments do not always pay off, most prefer to share the risk, meaning payments from distributions of co-invest or carry will be deferred, potentially for years.

An order reflecting the division of monies emanating from such a fund requires detailed drafting. Inevitably they are lengthy and complex because they must contain the safeguards to protect the receiving party from any attempts to thwart payments being made. They must also include requirements to provide documentary evidence of the performance of the fund, the timescales for the payments, the actual amounts paid and the tax consequences of those payments.

Some funds may permit the co-invest to be shared so that future distributions can be made direct to each spouse. Where this is possible, the order must make specific provision for the assignment, and further advice from corporate lawyers to implement the assignment will be needed.

If there are private equity or hedge funds involved in your divorce, it’s essential for experienced, specialist family lawyers to be involved to help you navigate and understand these complex investments, and to ensure that you actually receive the sums that you are entitled to.

About Nicola Harries

Nicola is the head of the family team at Stevens & Bolton, looking after clients coping with all aspects of family breakdown. Nicola has extensive experience dealing with mid to very high value divorce, including complex financial proceedings. She has drafted numerous pre and post nuptial agreements and advises unmarried families on the breakdown of their relationships, as well as dealing with disputes in relation to children. Nicola is ranked in the Legal 500 and Chambers UK Legal Directories and is a trained collaborative lawyer as well as a member of Resolution.

LinkedIn:

Nicola Harries

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Financial Disclosure: How to Gather Information

Published on
Vikkie Chetcuti-Gee
Vikkie Chetcuti-Gee
Associate
Burgess Mee

If you are filing a divorce application, you will also need to think about the financial aspect of your separation and how your assets will be divided between you. Although the two are (legally) separate processes, they go hand in hand and should be considered at the same time.

As part of figuring out how to financially separate from one another, it is likely that you and your spouse will need to exchange financial disclosure. In this jurisdiction (England and Wales), you have a duty to be full and frank with each other, which means you must both disclose all of your assets, liabilities and income wherever they are in the world.

What is financial disclosure?

If you are attending mediation with your spouse the mediator may have their own procedure and bespoke forms for you to complete. However, ordinarily, you will both need to complete a ‘Form E’, a long document which asks you to set out your financial position in detail. The purpose of the form is to allow each of you to have a clear picture of what the other has and says they will need so that you can make informed decisions about how the finances should be divided (or if they should be divided at all).

Once you have exchanged financial disclosure, you will both have the opportunity to ask questions about the information provided if further evidence or clarity is required. For example, if you are aware that your spouse has another bank account that they have not listed in their Form E, you can ask about this in your questionnaire. If, after receiving the answers to your questions, you are still not sure you have a complete picture, you can raise further questions in a document called a ‘schedule of deficiencies’. This is not an opportunity to ask new questions but to focus on the questions you originally asked that have not been answered properly.

If court proceedings have already been issued then you will both be required to complete the Form E as a formal court direction and it will be referred to in the proceedings and seen by the judge(s) who hear your case. If you are exchanging Forms E voluntarily but proceedings are issued later on (which may require you to complete the form again if it is sufficiently out of date or circumstances have changed) it is important to bear in mind that the court can see your original form.

What documents and information do I need to provide?

The Form E is divided into numerous different sections to enable you to provide information on:

  • Any property in which you have an interest.
  • The sums held in your bank accounts and any investments you may have. Also, the value of any life insurance policies.
  • The value of debts that are owed to you (for example, if you have loaned money to a friend that you are expecting to be repaid), any cash held in excess of £500 and any belongings worth more than £500.
  • Any liabilities you have, such as credit cards or bank loans and any CGT you would have to pay if any property or other asset you have is sold.
  • Business assets and directorships.
  • Pensions (excluding the state pension but it will not hurt to obtain a valuation online for this so that you are aware of any potential shortfall that may need to be addressed as part of the settlement), other assets and income (from employment, self-employment, partnership, investments, state benefits and any other income).

The form also asks you to confirm your income and capital needs (i.e. how much you need to meet your outgoings and to house yourself) and any other information you would like the court to take into account. This includes, but is not limited to, any significant changes in assets or income in the last 12 months or that you expect in the next 12 months. Finally, you can confirm what orders you would like the court to make. Even if you are not in court proceedings and are completing the form voluntarily it can be a good idea to complete this section to ensure your spouse has a clear picture of what you would like to happen. If you have a solicitor, they can advise you how to complete these sections.

You are also required to provide documents in support of the information you have provided. There is an extensive list on the final page of the form; depending on your circumstances, these may include:

  1. A recent mortgage statement (if applicable) and any valuations obtained in the last 6 months for any properties or land in which you have an interest.
  2. For each of your bank accounts, statements for the last 12 months (this is usually one of the most cumbersome tasks in preparing your disclosure).
  3. The latest statement for any investments.
  4. The surrender value for any life insurance policies.
  5. The last two years’ accounts and any other documents on which you base your valuation of your interest in any business.
  6. A statement confirming the cash equivalent value (or ‘CEV’) of your pension(s) and confirmation of your state pension entitlement.
  7. Your last three payslips, most recent P60 and P11D if you are employed.
  8. A copy of your last tax assessment (or a letter from your accountant confirming your tax liability) if you are self-employed and management accounts if your net income for the last financial year and estimate income for the next 12 months is significantly different.

You can also provide additional documents where necessary to explain or clarify any of the information you have supplied in the form.

Common mistakes people make when completing their disclosure

Providing your disclosure can be a protracted and cumbersome task so start gathering this information as soon as possible. It’s not unusual for mistakes to be made but these can lead to avoidable questions being asked at the questionnaire stage, which can increase the time spent on exchanging full disclosure and, if you have a solicitor, will increase your costs.

A common mistake is failing to list bank accounts because they are inactive or have a nil/negligible balance. Even if you no longer use the account, it must still be listed and bank statements provided (evidencing the zero balance). Another mistake is not calculating the total figures correctly. The form provides for all of your assets (less any liabilities) and income to be set out so that your spouse has a clear snapshot of your financial situation. Miscalculations can lead to further mistakes down the line if the figures are used in, for example, an asset schedule.

Finally, it is really helpful all round if the documents attached to the form are in a coherent and clearly labelled order. When putting your disclosure together you should aim to provide as much information clearly and as concisely as possible to avoid further questions. Bank statements are often numbered so it can be easy to see where there is a missing page. Likewise, provided there is a clear run of chronologically-dated entries, there is no need to include the superfluous pages often sent by banks.

What happens if you and your spouse agree not to exchange financial information?

It is possible for you and your spouse to agree not to exchange full disclosure via Form E. This might arise where the situation is amicable between you and you have already agreed how to resolve the financial aspect of your separation (which will need to be jointly filed with the court in a consent order). In that case, the court still requires you to provide some disclosure, but in a much shorter form called a ’Form D81’. This is simply a summary of your finances that shows the net effect of your agreement without providing full details or documentary evidence in support.

If you and your spouse have agreed the above, your solicitor (if you have one) is unlikely to be able to advise you properly about whether or not the agreement you have reached is fair and in line within the bracket of outcomes that a court may have ordered. To do this, they will need to see full disclosure by way of the process set out above. It is not uncommon for solicitors to ask clients who wish to proceed this way to sign a waiver confirming that they understand they are entitled to see full and frank financial disclosure from their spouse, that they wish to proceed without it, and that they accept the inherent risk that there may be unknown assets (or liabilities) of which they have no knowledge. It can be extremely difficult to revisit once concluded so advice should always be sought and caution exercised as to any potential unknowns. Your solicitor is not trying to be difficult. Instead, use this point as a moment to pause and reflect as to whether you are entirely content with the agreement you have reached and whether there is anything else you wish to know.

Conclusion

The main thing to remember when preparing your Form E is to start it early (don’t leave it until the week before you are due to exchange) and be as thorough as possible. It is one of the most important documents you will need to prepare during your separation and will be referred to often. Your case could be delayed if it is not completed correctly or insufficient information has been provided. It is also an opportunity for you to take stock of your own financial situation, obtain a much clearer understanding of your family’s overall finances and help you plan for the future.

Read more articles by Burgess Mee.

About Vikkie Chetcuti-Gee

Vikkie Chetcuti-Gee handles a range of family law cases, including complex financial proceedings frequently involving family trusts, significant business structures and forensic disclosure requests. She specialises in pre- and post- nuptial agreements for a range of clients from all walks of life, often for high net worth clients with a focus on sports personalities and their families. She also has a wealth of experience in private children law matters, particularly involving allegations of domestic violence and abuse, and where the other party involved is particularly intransigent. Vikkie is a member of Resolution and is committed to resolving cases in a non-confrontational way where possible.

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How to Prepare for Divorce: Steps to Take Before Filing
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How to Prepare for Divorce: Steps to Take Before Filing

Published on
Chris Sweetman
Chris Sweetman
Editor at The Divorce Magazine
Director at Fair Result

Sponsored post by Fair Result.

Divorce is an emotional and life-changing process. If you’re considering ending your marriage, knowing how to prepare before you file can make a significant difference in the outcome. With the right preparation, you can avoid common pitfalls and protect both your emotional wellbeing and financial future. Whether you’re seeking guidance on the divorce process or looking for effective divorce solutions, this guide will walk you through the essential steps to take before filing for divorce.

Step 1: Evaluate Your Reasons for Divorce

Before filing for divorce, it’s important to take the time to reflect on why you want to end the marriage. Divorce is a major decision that affects your life, your children (if you have any), and your finances. Ask yourself the following questions:

  • Have you considered marriage counselling or therapy?
  • Is this a temporary conflict or a long-term issue?
  • Are you financially prepared for the divorce process?

If you’ve weighed the pros and cons and feel that divorce is the right path, then it’s time to start preparing.

Step 2: Prepare Financial Documentation

One of the most important steps before filing for divorce is organising your financial records. Divorce settlements heavily rely on accurate and complete financial information. Collect the following documents:

  • Tax returns (last 3–5 years).
  • Bank statements and financial accounts (savings, checking, retirement).
  • Investment portfolios.
  • Mortgage and property information.
  • Pay slips and employment records.
  • Debts (credit cards, loans, etc.)

These documents will provide a clear picture of your financial standing, making it easier to negotiate a fair divorce settlement. If you’re looking for divorce solutions that can help you manage this process efficiently, consider reaching out to Fair Result.

Step 3: Understand and Prepare for the Divorce Process

Divorce laws and processes vary depending on your location. In the UK, you can file for divorce using one of two methods: a sole application or a joint application. It’s crucial to understand which option is best suited for your situation. Here’s a brief overview:

  • Sole Divorce Application: One spouse files for divorce without the other’s participation. This may occur when the divorce is contested, or the spouses are not on good terms.
  • Joint Divorce Application: Both spouses agree to the divorce and file together. This is often the less contentious route and can lead to a smoother and faster resolution.

Understanding which route to take will help you set realistic expectations about timelines and costs. In 2024, the average time from filing to a final divorce order for sole applications was around 49 weeks, while for joint applications, it was 43 weeks. Keep this in mind as you prepare for the process ahead.

Step 4: Plan for Your Children’s Wellbeing

If you and your spouse have children, their wellbeing must be at the forefront of your divorce preparations. The family court system prioritises the best interests of the children, and so should you. Consider the following:

  • Where will your children live?
  • How will custody and visitation be divided?
  • What financial support arrangements need to be made?

Make sure you understand the legal aspects of child custody, support, and visitation agreements in your area. It’s also important to keep the lines of communication open with your spouse when it comes to parenting decisions. If you’re unsure about any of these aspects, seeking advice from an experienced family law professional can help you find the right divorce solutions.

Step 5: Consider Your Living Situation

Divorce often means a significant change in living arrangements. If you’re living with your spouse, you should plan whether one of you will move out or if you will continue living together during the divorce proceedings. The decision may depend on:

  • Ownership or rental agreements.
  • Financial stability and ability to afford separate housing.
  • Custody arrangements for children.

In some cases, staying in the marital home during the divorce process might be necessary to ensure stability for the children or for financial reasons. However, if the environment becomes too toxic or stressful, moving out might be a better option for your mental health.

Step 6: Seek Legal Advice and Support

No matter how amicable your relationship with your spouse may seem, it is always in your best interest to prepare and consult with a family law expert before filing for divorce. Legal advice can help you avoid common pitfalls, such as agreeing to an unfair financial settlement or signing documents you don’t fully understand.

At Fair Result, we offer unique divorce solutions with fixed fees, ensuring that you won’t have to worry about escalating legal costs. Our team of divorce specialists is here to guide you through the entire process, sharing the financial risks with you. You pay nothing until your divorce is finalised, allowing you to focus on moving forward with confidence.

Step 7: Protect Your Emotional Wellbeing

Divorce is an emotional journey, and it’s easy to become overwhelmed by stress, anger, or sadness. Taking care of your mental health is just as important as the legal and financial aspects of divorce. Consider seeking emotional support from:

  • Therapists or counsellors
  • Divorce support groups
  • Trusted friends or family members

Maintaining a strong emotional foundation will help you stay focussed and make better decisions during the divorce process. Divorce solutions that address both the emotional and financial aspects are essential for a smoother transition.

Step 8: Budget for the Divorce Process

The financial impact of divorce can be significant, and it’s important to create a realistic budget for the process. Divorce costs can vary depending on the complexity of your case and the law firm you choose. The cost of living crisis has made many couples hesitant to move forward with divorce, but with the right legal team, you can minimise financial stress.

Fair Result offers a fixed-fee structure, meaning you won’t pay anything until your divorce settlement is finalised. This innovative approach allows you to avoid unexpected fees and prepare your finances with confidence.

Why Early Divorce Preparation Matters

Preparing for divorce before filing can save you time, money, and emotional stress. By following these steps and seeking professional guidance, you can ensure that you are prepared for the challenges ahead. Divorce solutions from trusted firms like Fair Result are designed to help you through the process with minimal disruption to your life.

Are you considering divorce?

Contact Fair Result today to learn how our expert team can assist you in navigating this difficult time. With our fixed-fee divorce solutions, you can rest assured that your financial and emotional wellbeing will be protected every step of the way.

Call: 07500933818 or 0333 577 7009

Email: peter@fair-result.co.uk or chris@fair-result.co.uk

Find out more about Fair Result.

Read more articles by Chris Sweetman.

About Chris Sweetman

Chris Sweetman is an independent family solicitor and director of Fair Result – An award-winning law office who pride themselves on using innovative ways to help clients through the stress and complications of a marriage breakdown.

Chris can be contacted on 07500933818 or via email chris@fair-result.co.uk.

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Divorce – It’s a Balance Between the Emotional Stress, the Cost and the Return!
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Divorce – It’s a Balance Between the Emotional Stress, the Cost and the Return!

Published on
Peter Marples
Peter Marples
Editor at The Divorce Magazine
Director at Fair Result

Many of you know I was the founder of a progressive family law practice Fair Result with my business partner Christopher Sweetman.

The practice is not apologetic that we are a challenger brand but in the past 4 years we have become a major practice in England, with unique partnerships including the Professional Footballers Association and winning countless awards, both in the UK and Internationally.

Whist a number of our clients could be seen to be ‘wealthy’, by no means all of them – indeed 75% of them are not in this category.

We have a wide spread profile of clients, representing the whole of society and we will often take on a client who has no money to fight their divorce in terms of fees. This is exactly the reason we set up the practice.

As a non-lawyer, it never ceases to amaze me how ruthless lawyers are when it comes to their fees. I was brought up to focus on my clients and the returns would ultimately follow, not think of myself first and that customers are way down the line of those we should be focussed on.

In the past four years, I have witnessed opposing clients dropped by lawyers because they can’t see a future income stream, that client engagements are paused because lawyers don’t have visibility of their fees over the next few months and a total destain for client’s emotions and challenges.

Don’t get me wrong, we need to be paid for what we do. We aren’t a charity, but there does come a point at which clients should be respected for what they are ‘those that pay the wages and the overheads’.

We set up Fair-Result to do exactly that, client first! We do have challenges with clients paying but this is always at the end of a process, and we share the risk in that as the process progresses.

There is never a week goes by in our business where we receive a call from someone that we spoke to over 2 years ago. A call which starts in the normal way. ‘Hi, its… remember me’ followed by our response that is ‘Yes, how are things’. The same line always follows – the fact that frankly nothing has progressed in the previous two years, they have spent some money, but not a lot and are now in a place where they simply don’t know what to do, and their legal advisors are not offering much in the way of solutions.

Nothing surprises us anymore.

However, in the past three weeks alone, we have received at least five calls such as this, one with £m’s in the marital pot, another with a not inconsiderable number of rental properties and a third instance where the wife (our potential client) is starved of cash and assets, despite there being considerable funds to distribute, in the form of Public Sector pensions, a marital home and some limited investments.

During my own divorce, I used to call my former wife ‘penny wise and pound foolish’. She would argue about the pennies but forget about the substance of the whole pot we were arguing about and spend endless thousands with her lawyers arguing about where I had taken the latest EasyJet flight too.

So, what is the purpose of this article? Quite simply it is to present a position that when undergoing a divorce, you are balancing up three key things:

  • Your emotions
  • The cost
  • The reward or result in terms of financials and in many cases the impact on the children.

So, if you are arguing about £50,000 or £5m the principle is the same.

You have to invest to get the result you want, or you will one of those people calling us up after two years having got nowhere.

But I hear you say, I don’t have the cash? To fight them.

Well, that is where Fair Result comes in. The ONLY fixed fee financial divorce settlement business in the UK. And guess what, you pay nothing until the financial agreement has been signed by both parties, whether it takes us 2 months or 2 years to finalise.

We share the risk with you, our aim is to minimise the emotional stress but above all it is to get you exactly what you are entitled too.

So, stop plodding on for two years, when you know you won’t get anywhere, spending £500 here and there when that is all you can afford, getting more and more wound up about your spouse’s behaviour and spending habits.

Get it closed off, sorted out and you too can move on both emotionally and financially.

As we get older, we begin to realise that life is short, the years clock off quicker than you want them too. Why spend 2 years getting nowhere when you can contact the Fair Result team, and it will cost you nothing until your divorce is sorted – absolutely nothing.

Contact Peter at peter@fair-result.co.uk 24/7 and you will be guaranteed of a response within 30 minutes. A fixed fee, set from the outset and nothing to pay until your divorce is settled.

If you can get a better offer than this contact us and we will do your divorce for absolutely nothing, irrespective of its complexity – GUARANTEED!

Read more articles by Peter Marples.

About Peter Marples

Peter Marples – Director of Fair Result and qualified accountant, with the determination to change the way divorce is transacted. For further advice on financial settlements and navigating divorce, use the contact details below:

  • Email
  • Give the team a call – 07500933818 or 0333 577 7009
  • Complete an enquiry form

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Navigating the Division of Your Property During a Divorce

Published on
Tom Floyd
Tom Floyd
Marketing Director
Webuyanyhouse.co.uk

Divorce is a challenging experience filled with complex emotions and big decisions. Among the many issues to address, you will need to decide the fate of the family home. The family home often holds substantial emotional value, making decisions about its future particularly difficult. By understanding your options and approaching the process with open communication, you can work towards a resolution that best suits both yourself and your ex’s needs. Our guide aims to offer an insight into what to expect from the process, helping you along this challenging journey.

Understanding Your Legal Position

One of the first steps to understand is the legal side of property ownership during a divorce. If you jointly own the property, you will share rights and responsibilities. This includes financial obligations such as mortgage payments and property taxes. However, it also grants you rights to potential profits if the property is sold.

To fully gauge your legal standing and the implications for the property, consulting with a divorce lawyer is strongly recommended. They can provide expert guidance on

  • How will your financial contributions to the property impact its division?
  • How do pre-nuptial agreements influence property ownership? (If relevant)
  • The potential legal consequences of the options available to you.

Understanding your legal rights and entitlements can help you make informed decisions about the future of your family home.

At this point, it’s a good idea to consider other joint financial commitments you may have:

Joint Financial Commitments

Dividing shared finances extends beyond the property. Joint bank accounts require immediate attention. Contact your bank to inform them of the separation and consider setting spending limits to prevent unauthorised withdrawals.

Mortgage and Loan Solutions

Handling a joint mortgage during a divorce requires careful consideration. Several options exist:

  • Refinancing: Both parties can apply for separate mortgages on their new residences.
  • Transferring ownership: One partner can assume sole ownership of the property and refinance the mortgage.
  • Selling the property: If neither partner wishes to retain ownership, selling the property and dividing the proceeds is an option.

We recommend consulting a financial or mortgage advisor to help you find the best option based on your financial circumstances.

Exploring Your Options

Once you’ve clarified your legal position and financial situation, it’s time to consider your options for the family home. The primary choices are to sell or retain the property.

Selling the Family Home

If both of you agree that selling the home is the best course of action, here are some things to consider:

  • Valuation: Accurately assessing the property’s market value will allow you to determine an accurate sale price.
  • Mortgage balance: Comparing the property’s value to the outstanding mortgage will help you understand if you can cover the payments after a sale.
  • Living arrangements: Consider the financial implications of finding new accommodation.
  • Market conditions: Understanding the current housing market can influence the timing of the sale and potential sale price.

Retaining the Property

If one of you wishes to remain in the family home, buying out the other’s share is an option. This involves:

  • Property valuation: Determining the property’s fair market value.
  • Financial arrangements: Agreeing on the purchase price and payment terms.
  • Mortgage refinancing: The remaining partner may need to refinance the mortgage.

It’s important to weigh the pros and cons of each option carefully. Factors such as emotional attachment, financial implications, and long-term plans should be considered. 

Navigating the Property Division Process

Going through a divorce is typically an extremely emotional time, which can be aggravated further if you decide to sell your home. To manage this process more effectively and reduce the emotional impact on yourself, it’s vital that you try to visualise the property as a financial asset rather than an emotional bond.

Here are some strategies to help you handle the situation:

  • Prioritise Practical Considerations: Before starting the process, establish clear agreements on details like the home’s market value and the acceptable sale price. By understanding this from the start, you will reduce running the risk of misunderstandings later on in the process.
  • View the sale as a Step Forward: Selling the property is an opportunity to move on to a new chapter in your life. Allowing the sale to flow can ensure a smoother and quicker transition.
  • Consider Mediation if Needed: Disagreements are common when dealing with a property during a divorce. If they do arise, mediation can be an effective way to resolve any conflict and reach a fair agreement.

 Pricing Strategy

Determining a sale price for your property is critical in ensuring a smooth transaction. To speed up the sale, consider pricing your home slightly below market value to create more interest and attract more buyers. If this approach isn’t yet achieving the desired results and you’re eager to get the property off your hands, reach out to a property professional. They specialise in fast property sales, helping you move forward with your life without the hassle of the open market.

It’s also essential to communicate openly with your ex-partner about your expectations for the sale price. If direct negotiations prove difficult, involving an estate agent can be beneficial. Estate agents can mediate discussions, facilitate negotiations, and help both parties reach a fair agreement, aiming to keep the process as seamless and amicable as possible. 

To Conclude

By adhering to the steps outlined in our guide and maintaining open communication with your ex-partner, you can navigate the process with confidence. Remember, you don’t have to go through this alone. Estate agents and legal representatives are available to support you throughout the entire process, helping to reduce any stress or tension that may come up.

Approaching the situation with respect and care can help you reach a decision that benefits everyone involved.

About Tom Floyd

We Buy Any House have over 16 years of experience in delivering a quick and hassle-free house sale for thousands of customers. They specialise in supporting customers going through difficult life events, such as divorce, by offering a quick and stress-free property sale. Their team of specialised experts will guide you through the process, taking care of all legal aspects so you don’t have to.

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How to Prepare for Divorce: A Comprehensive Guide
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How to Prepare for Divorce: A Comprehensive Guide

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Divorce is a significant life event that can impact various aspects of your life. Many people enter the process without fully understanding its implications, but preparation is crucial. This guide will help you navigate divorce in the UK by focusing on mental, financial, and parental preparation.

Mentally Prepare for Divorce

Divorce can be mentally and emotionally challenging. Before proceeding, ensure you’re certain about your decision. Consider marriage counselling or individual therapy to gain clarity and support.

Visualising your post-divorce future can help you focus on your goals instead of the past. Despite preparation, expect to face difficult days. Develop healthy coping strategies like maintaining physical health, exercising, spending time with friends, and engaging in enjoyable activities. A counsellor or therapist can provide valuable support during this time.

When choosing a divorce lawyer, look for someone who offers both legal expertise and empathetic guidance. A good family lawyer can ease the emotional burden of the process.

Financially Prepare for Divorce

Financial concerns are often the most pressing during a divorce. Early legal advice is crucial to understanding your entitlements and preparing for financial changes.

A family lawyer can help you understand your rights regarding the divorce settlement, the family home, and potential spousal maintenance. Plan for your immediate living expenses, as finalising a financial settlement can take months, and court proceedings may extend this period.

If you’ve depended on your spouse’s income, explore long-term financial support options such as benefits and spousal maintenance. Avoid taking actions that could be perceived as concealing funds, like moving money to a private account, as this can complicate legal proceedings.

Always consult an expert family lawyer before making significant financial decisions.

Parental Preparation for Divorce

For parents, divorce adds the concern of its impact on children and the parent-child relationship. Early agreement on childcare arrangements with your ex-partner can reduce stress for everyone involved. Drafting a formal parenting plan can provide clarity and minimise uncertainty.

Consult a family lawyer to understand your parental rights and ensure the parenting plan is fair and in your children’s best interests. Agree with your ex on what and how to tell your children about the divorce, ensuring they receive a consistent message from both parents.

Seeking Legal Advice

Being prepared for the divorce process and your new life afterward is crucial. Expert advice can make the journey smoother and less stressful. Ensure you choose experienced divorce lawyers who can provide specialist legal guidance for a smooth divorce.

Read more articles by Gemma Scourfield.

About Gemma Scourfield

Gemma is a divorce and family law solicitor with Woolley & Co, Solicitors based in Pembrokeshire West Wales. She has been based in Wales since qualifying in 2007 although has clients throughout the UK and abroad. In 2016, Gemma was accredited as an Advanced Family Law Panel Member with the Law Society which recognises her expertise in domestic abuse and financial relief.

Gemma qualified as a family law solicitor in 2007, she joined Woolley & Co from a regional firm in Wales in August 2021.

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The Dangers of DIY Divorces
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The Dangers of DIY Divorces

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Emma Alfieri
Emma Alfieri
Legal Director
Greene & Greene Solicitors

Since fault free divorce law came into effect on 6th April 2022, it has become much easier for parties to complete a DIY divorce without seeking legal advice. Whilst the changes were welcomed, the new law has resulted in many DIY divorcees not understanding the law and/or encountering problems along the way.

One common (and wrong) assumption is that the Final Order of divorce automatically prevents an ex-spouse from making financial claims in the future. This is false. The only way to achieve a legally binding financial “clean break” is for the parties to also submit a separate signed Consent Order to the Court embodying the financial agreement they have reached. If this additional step is not taken, an ex-spouse is entitled to make financial claims against their former spouse in the future, even after they are divorced and the assets have been divided.

A trigger for a financial claim by an ex-spouse months or years after the divorce could be, for example, if a former spouse later accumulates wealth, such as by inheritance or lottery win. This situation can be stressful and expensive to sort out and therefore it is always advisable to enter into a Consent Order at the time of divorce.

In some DIY divorce cases the parties may be aware of the requirement to have a Consent Order but do not take advice before signing the document.   This could result in a binding Order that excludes valuable assets or income that cannot later be re-visited.

Another common mistake is some of the less obvious assets of the marriage such as pensions and business interests are overlooked, instead focussing on property alone. The pension assets of a marriage can be some of the most valuable assets and are often ignored resulting in a poor outcome for the party with the lower pension provision.

Timing is another factor that can get overlooked. For example, a divorce lawyer would usually recommend a final Order of Divorce is not applied for until financial matters have been resolved and a Consent Order approved by the Court (but not in all circumstances). There could also be consequences if a party re-marries before they have properly dealt with financial matters.

Believe it or not, every case is different. The individual facts need to be applied to each set of circumstances. Whilst many DIY divorcees will scour the internet for advice, there are no on-line resources that provide the answer to every single situation/scenario.  That’s why is it is always advisable to take legal advice early on, even if that advice is limited to just one consultation.

In conclusion, whilst a DIY divorce will always be the cheapest option, it is important that parties going through divorce can properly understand what they need to do, when, and to consider any other factors they may not have thought about.  This will ensure parties do not find themselves in a position where their quest to save money could be a decision they later live to regret.

This article is only intended to be a summary and not specific legal advice.

Read more articles by Emma Alfieri.

About Emma Alfieri

Emma Alfieri is a Legal Director at Suffolk firm Greene & Greene Solicitors.

Emma advises on all aspects of family law, including divorce and associated financial matters, disputes between cohabitants and child related disputes.

A member of Resolution, Emma is committed to resolving disputes as positively and agreeably as possible whilst also being motivated to obtain the best possible outcome for her clients.

Since 2012 Emma has been consistently recommended by the Legal 500 on an annual basis and in the most recent 2024 edition Emma is ranked as a “rising star”.

As an advocate of fault free divorce, Emma lobbied at Parliament with other members of Resolution in 2016 to bring about the recent changes to divorce law.

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What is a Single Joint Expert (SJE)?
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What is a Single Joint Expert (SJE)?

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Chris Sweetman
Chris Sweetman
Editor at The Divorce Magazine
Director at Fair Result

Divorce can be a complex and emotionally charged process, especially when it involves the valuation of shared assets. One crucial element that often comes into play is the role of a Single Joint Expert (SJE). In this FAQ guide, we’ll delve into what an SJE is, why they are important, and how they can help streamline your divorce proceedings.

What is a Single Joint Expert (SJE)?

A Single Joint Expert (SJE) is an independent expert appointed jointly by both parties in a divorce case to provide an impartial valuation or assessment of shared assets. This expert is usually agreed upon by both parties and approved by the court. The SJE’s role is to offer a neutral perspective, ensuring that both parties receive a fair and accurate evaluation of their assets, which can include properties, businesses, and other significant financial interests.

Why is an SJE Important in Divorce Proceedings?

  1. Neutral and Unbiased Opinion: An SJE provides an objective assessment, which helps to prevent disputes and ensures that neither party feels disadvantaged.
  2. Efficiency and Cost-Effectiveness: By using a single expert agreed upon by both parties, the process becomes more streamlined and can reduce the overall costs compared to each party hiring their own expert.
  3. Court Approval: The court often prefers the use of SJEs because their involvement can lead to quicker resolutions, reducing the court’s workload and encouraging settlements outside of court.
  4. Clarity and Precision: SJEs are experts in their fields, providing detailed and accurate valuations that can withstand scrutiny from both parties and the court.

How is an SJE Appointed?

The appointment of an SJE typically follows these steps:

  1. Agreement Between Parties: Both parties must agree on the need for an SJE and select a suitable expert.
  2. Terms of Reference: The scope of the SJE’s work is defined in a document called the terms of reference, which outlines what the expert is expected to evaluate and report on.
  3. Court Approval: The agreed-upon expert and the terms of reference are then submitted to the court for approval.
  4. SJE’s Report: The SJE conducts their evaluation and provides a detailed report to both parties and the court.

What Happens After the SJE’s Report?

Once the SJE’s report is submitted, both parties have the opportunity to review and discuss the findings. If there are any disagreements or additional clarifications needed, these can be addressed through further questions or discussions with the SJE. Ultimately, the report serves as a key piece of evidence in reaching a financial settlement.

Final Thoughts

At Fair Result, we understand the complexities of divorce and the importance of accurate asset valuation. Our team is experienced in working with SJEs and can guide you through the process to ensure a fair and equitable outcome.

Read more articles by Chris Sweetman.

About Chris Sweetman

Chris Sweetman is an independent family solicitor and director of Fair Result – An award-winning law office who pride themselves on using innovative ways to help clients through the stress and complications of a marriage break down.

Chris can be contacted on 07500933818 or via email chris@fair-result.co.uk.

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Understanding Your Financial Rights and Entitlements in Divorce
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Understanding Your Financial Rights and Entitlements in Divorce

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Richard England
Richard England
Divorce & Family Law Solicitor
Woolley & Co Solicitors

When navigating a divorce, understanding your financial rights and entitlements is essential. The process of dividing assets and determining financial settlements is highly complex and varies significantly from one case to another. This guide aims to shed light on key considerations for those seeking a divorce and looking for financial advice.

Starting point for asset division

Typically, the initial approach to splitting assets in a divorce starts with a 50/50 division. However, this is just a baseline. Several factors may influence this split, including the length of your marriage, each spouse’s earning capacity, and both current and future financial needs. This complexity underscores the importance of early legal advice to achieve a fair settlement.

Understanding different assets

Assets like pensions, homes, businesses, and savings are all part of the equation. Each type has its considerations:

  • Pensions – Often the second-largest asset after the home, pensions can be divided in several ways, including sharing or offsetting against other assets. Accurate valuation is crucial, as is understanding the implications of accessing these funds.
  • Family home – There are various ways to handle the family home, from selling and splitting the proceeds to one party buying out the other or maintaining joint ownership until a set future date. The chosen method should consider other assets and overall financial needs.
  • Business assets – If a business qualifies as a matrimonial asset, it may need to be valued independently to ensure it is appropriately considered in the settlement. Options include offsetting its value against other assets, sharing ownership, or even selling the business.

Calculating a fair settlement

Reaching a fair settlement requires a detailed assessment of all assets. It’s crucial to get accurate valuations and consider debts as well as assets. The division isn’t always equal, as the needs, contributions, and future prospects of each party play significant roles.

Legal process and negotiations

If you and your spouse cannot agree on a settlement, the matter may need to go to court, where a judge will decide based on a broad range of factors from the duration of the marriage to the standard of living and contributions made by each spouse. However, settling out of court through negotiation or mediation is often less costly and less contentious, focusing on fair and amicable resolutions.

The role of legal advice

Given the intricacies of financial settlements in divorce, consulting with an experienced family lawyer is highly advisable. A lawyer can help clarify what you are entitled to and suggest realistic expectations based on your unique circumstances. They can also facilitate negotiations and help draft a consent order to make any agreed-upon settlement legally binding.

Next steps

If you are going through a divorce and need to understand your financial entitlements better, it is wise to start with a consultation. Legal experts can offer personalised advice tailored to your specific situation, helping you navigate the complexities of asset division with confidence. Remember, every divorce is unique, and professional guidance is key to securing a fair financial future.

For personalised advice and to understand more about your specific circumstances, consider scheduling a consultation with a family law specialist. They can provide comprehensive guidance and support throughout the divorce process, ensuring your financial interests are well-protected.

Read more articles by Richard England.

About Richard England

Richard England is a divorce and family solicitor with Woolley & Co based in Sutton Coldfield near Birmingham. He is also a fully qualified family mediator and has over 33 years’ experience in the legal profession and over 30 years specialising in Family Law. During that time, he has built an enviable reputation representing clients in the Midlands and surrounding areas he has also dealt with overseas clients on many occasions.

Richard has been named as a Recommended Lawyer for Family Law in the West Midlands in Legal 500, where they note he is “very clever” and has “a brilliant business mind” as well as being “very professional and also speaks normal language which is a huge advantage”.

Richard specialises in financial settlements on divorce and in particular, complex cases involving business interests, farms, family trusts and overseas assets. He also advises clients in respect of co-habitation and pre-nuptial agreements, living together agreements and also in cases involving children.

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Navigating your finances through divorce: A comprehensive guide
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Navigating Your Finances Through Divorce: A Comprehensive Guide

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Andrew Robotham
Andrew Robotham
Divorce & Family Lawyer
Woolley & Co Solicitors

Going through a divorce is undoubtedly a challenging time, and it’s crucial to understand that completing the legal process is just one aspect. Sorting out finances is equally important but often overlooked. In this guide, we’ll address common reasons why people delay or avoid settling financial matters, emphasising the potential pitfalls, and offering guidance for a smoother financial transition.

Why do some delay a divorce settlement?

  1. Believing there is nothing to protect: Some couples think they have nothing valuable to protect, so hiring a solicitor seems unnecessary. However, even seemingly modest assets should be properly addressed to avoid future complications.
  2. Self-resolution confidence: Couples who are amicable and believe they can sort out financial arrangements by themselves may delay seeking professional advice. While this may work initially, unforeseen changes or disagreements can arise later.
  3. Cost concerns: The perception that hiring a solicitor is expensive leads some to avoid professional assistance. However, the long-term financial consequences of not settling matters properly can far outweigh the initial cost.
  4. Information agreements: Couples who have informally agreed on financial matters may skip the formal process. Unfortunately, without a legally binding agreement, these arrangements can be challenged in the future.
  5. Postponing due to stress: Some couples decide to delay financial discussions, thinking they can revisit them later. However, procrastination can lead to legal and financial complications down the road.

Importance of timely settlement

Future claims:

Without a consent order, an ex-partner may have legal claims on assets acquired post-divorce, such as lottery winnings or inheritances.

Changing circumstances:

Amicable relations can change due to new partners or altered circumstances. A delay might result in a partner changing their stance on previously agreed-upon terms.

Tax implications:

Delays may lead to unnecessary tax liabilities, especially regarding capital gains tax on property sales not considered the main residence.

Asset valuation:

Waiting to resolve assets can lead to disputes over their current value, potentially disadvantaging one party. It’s crucial to have up-to-date valuations during settlement discussions.

Financial advice and consent orders

Seek professional advice:

Consulting financial advisors and solicitors ensures you make informed decisions and protects your interests in the long run.

Consent orders:

Even if you’ve amicably agreed on terms, formalise the agreement with a court-issued consent order. This legally binding document prevents future disputes and ensures financial clarity.

Conclusion: Take control of your financial future

In conclusion, while the emotional aspects of divorce are undeniable, addressing financial matters promptly is crucial for a secure future. Regardless of the simplicity of your financial situation, seeking professional advice and obtaining a consent order will protect you from potential legal and financial pitfalls. Remember, the initial investment in settling matters now is far less than the potential cost – both financially and emotionally – of neglecting proper financial resolution. If you’ve decided on or are going through a divorce, ensure your financial affairs are in order for a smoother transition into the next chapter of your life.

Read more articles by Woolley & Co Solicitors.

About Andrew Robotham

Andy is an experienced divorce and family lawyer with Woolley & Co, Solicitors. He has built an enviable reputation in the Derbyshire and Leicestershire area. He deals with all areas of matrimonial law, including divorce, children matters, financial settlements as well as civil partnerships, separation, cohabitation, and prenuptial agreements.

In the 2020 edition of Legal 500 Andy is named as a Recommended Lawyer for Family Law in the East Midlands, where it is noted ‘Andrew Robotham’s qualities are numerous. He is able to combine empathy for the situation as well as total professionalism that the circumstances demand’.

You can visit Andy’s profile here for more.

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Budgeting for One: A Guide to Post-Divorce Finances
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Budgeting for One: A Guide to Post-Divorce Finances

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Embarking on the journey of financial planning post-divorce can be a challenging but transformative process. Navigating the complexities of single parenthood and managing tighter finances might seem overwhelming. Divorce often brings significant financial changes, transitioning from joint incomes to a single income, requiring a solid financial plan.

Here’s a breakdown of key aspects to consider:

1. Budgeting and Financial Planning:

  • Dive deep into your income, expenses, and financial obligations to create a realistic plan aligning with short-term and long-term goals.

2. Debt Management:

  • Prioritise and manage shared debts, exploring strategies for a debt-free future.

3. Insurance Analysis:

  • Review insurance coverage to ensure adequate protection for you and your children.

4. Investment Guidance:

  • Craft a tailored investment strategy based on your risk tolerance, time horizon, and financial goals.

5. Asset Division and Settlement Support:

  • Navigate asset division with insights into short and long-term consequences and make informed financial decisions.

6. Estate Planning:

  • Safeguard assets and secure your children’s future by creating a comprehensive estate plan, including wills, trusts, and guardianship arrangements.

7. Tax Planning:

  • Collaborate with a tax advisor to comprehend and optimise post-divorce tax implications.

Navigating these aspects can empower your financial journey after divorce. Consider seeking guidance from financial professionals or utilising online resources to make informed decisions tailored to your unique circumstances.

Read more articles by Peter Marples.

About Peter Marples

Peter Marples – Director of Fair Result and qualified accountant, with the determination to change the way divorce is transacted. For further advice on financial settlements and navigating divorce, use the contact details below:

  • Email
  • Give the team a call – 07500933818 or 0333 577 7009
  • Complete an enquiry form

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Will I Lose My Personal and Business Assets in Divorce?
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Will I Lose My Personal and Business Assets in Divorce?

Published on
Kate Booth
Kate Booth
Solicitor, Head of Family & Matrimonial
Brindley, Twist, Tafft & James Solicitors (BTTJ)

Former partners have the right to claim a stake in anything from their ex’s business to a jackpot win unless the correct legal procedures have been followed to ensure full protection.

Without a financial order in place – which includes a clean break – divorcees are leaving themselves exposed to the risk of being forced to part with personal or business assets.

A divorce simply ends a marriage. Without a financial order couples are still financially tied in the eyes of the law. So if a person later builds a big nest egg, has a successful business, makes a good return on the sale of a property or wins the lottery, their ex has the right legally to make a claim against them.

Although dividing up a business and its assets is a lot more complicated for the courts, it is still not without risk. A lot of it comes down to personal circumstance.

A court will look at various things such as the length of the marriage, when the business began, the kind of business it is, its assets, how much it was worth in the past and by how much it has increased during the marriage – in some cases a business will be deemed as an asset capable of being divided.

Factors which help determine a court’s ruling include the financial circumstances of each of the individual parties, ensuring both sets of financial needs are met to accommodate a decent standard of living.

Where possible courts will look at meeting a spouse’s financial needs without dipping into non-matrimonial assets.

A person who has remarried would generally be unable to make a claim against their former spouse, but the person who remains unmarried can still apply.

People who end their marriages with online divorces, including couples who make a joint application, may be among those who later find themselves the subject of claims.

With no legal advice included in the ‘DIY divorces’ many remain unaware the divorce simply means the end of the marriage and not the end of financial ties.

It comes back to the first piece of advice we would always give which is do not leave things, even if very amicable at the point of divorce, as if one day circumstances change – for example unemployment, illness or injury – a court can only work from values of assets at the time the application is brought.

It may rule that an increase in the value of the business should not be attributed to the person making the claim, but there is always a danger that it might be.

For further details on BTTJ log on to www.bttj.com.

Read more articles by Brindley, Twist, Tafft & James Solicitors (BTTJ).

About Kate

Kate deals with private family law cases including divorce and related financial matters, children, injunction and cohabitation issues. She also advises clients in connection with pre-nuptial and cohabitation agreements.

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