Splitting assets - timing of valuation

[AnotherStatistic]

A question about splitting up common assets in a divorce:

The value of our common assets has changed between separation and pending divorce. Do we use the values at the time of separation or now?

Given our change in living arrangements my partner (primary earner in our relationship) has saved a significant amount of money....

(no kids involved)

[standing on the sidelines]

if you both agree on the date of separation then that is when it is done. Doesnt matter if your partner is saving money now, they have that right and since you are separated you have no right to that money.

[Ontario_Dad_41162]

Totally agree with the other poster. The valuation date is the date of separation. Keep in mind though that doesn't necessarily mean when one person lives in the matrimonial home - the actual date of separation can be earlier depending on some factors. In my case, I left the house in July of 2007 and my ex agreed with me (to my surprise) that the separation date was Oct of 2006 which is when we agreed to split and we stopped living as a married couple even though residing in the same house.

[billm]

Valuation should be easy - it is when you split things and took responsibility for 'your' things.

If someone moves out of the matrimonial home, but continues to pay the bills, etc, the move out date may not be a fair one, given that property values usually go up.

What I find interesting (ie. a joke), is that everyone wants to keep the increase in value of an asset from the time between separation to equalization, but when it decreases, they think it should be shared, or the other person's problem.

His savings would be his to keep - but support payments etc should be considered.

The house asset should be evaluated when one assumes full responsibility for it (mortgage and title transferred, bills etc), not the date of separation, unless there is something in writing that transfers responsibility such that if the value of the house goes down (or up), the one retaining it deals with that. IMHO

[May_May]

If someone moves out of the matrimonial home, but continues to pay the bills, etc, the move out date may not be a fair one, given that property values usually go up.

Billm...I moved out of the matrimonial home Jan 1...but continued to pay until our lawyers exchanged letters approx. July 1 (I was paying for my lease, as well as 50% of mortgage, insurance until July 1). My name is still on title/deed as stbx hasn't bought me out yet (he is stalling and waiting until complete divorce is agreed upon). What are your thoughts in my situation ? The separation date I have been referencing so far is June 2010 when I verbally ended the marriage.

[mom2three]

Billm...I moved out of the matrimonial home Jan 1...but continued to pay until our lawyers exchanged letters approx. July 1 (I was paying for my lease, as well as 50% of mortgage, insurance until July 1). My name is still on title/deed as stbx hasn't bought me out yet (he is stalling and waiting until complete divorce is agreed upon). What are your thoughts in my situation ? The separation date I have been referencing so far is June 2010 when I verbally ended the marriage.

You would have a valid claim for the issue to be addressed based on the increase in value rather than the valuation date, just as your ex would have a valid claim if the value had significantly decreased. If the property has increased in value significantly and you have continued to pay while its value increased then you have your lawyer argue your claim to your benefit.

[mcdreamy]

Billm...I moved out of the matrimonial home Jan 1...but continued to pay until our lawyers exchanged letters approx. July 1 (I was paying for my lease, as well as 50% of mortgage, insurance until July 1). My name is still on title/deed as stbx hasn't bought me out yet (he is stalling and waiting until complete divorce is agreed upon). What are your thoughts in my situation ? The separation date I have been referencing so far is June 2010 when I verbally ended the marriage.

MayMay, I'm on title alone to our matrimonial home. I was told by my lawyer yesterday that because of that, I alone accrue any increase or decrease in the value of the home following the date of valuation, regardless of whether/when he moves out or not, or when or if we sell.

I would imagine that if you are both on title, you would both be entitled to any increase/decrease in the value of your home, regardless of the valuation date.

[HammerDad]

MayMay, I'm on title alone to our matrimonial home. I was told by my lawyer yesterday that because of that, I alone accrue any increase or decrease in the value of the home following the date of valuation, regardless of whether/when he moves out or not, or when or if we sell.

I would imagine that if you are both on title, you would both be entitled to any increase/decrease in the value of your home, regardless of the valuation date.

I don't know if your lawyer is entirely correct.

Part of the equation on whether or not a spouse may be entitled to future growth or loss in the house is whether or not said spouse is continuing to contribute to maintaining the house (ie. mortgage/taxes etc). If, at the separation date, one spouse ceases to contribute to the house, then their argument for growth entitlement significantly diminishes.

So, being the sole person on title does not automatically mean there is no entitlement to future growth. It is a matter of what arguments each party puts forward that will determine if their is entitlement to share in growth or depreciation.

If Party A argument is they are the sole party on title, and Party B's argument is that they continued to contribute to the maintenance of the house by paying the mortgage etc., a judge is likely going to decide that Party B's argument is more valid. Most likely the reasoning would be unjust enrichment to not take into consideration Party B's continuing contribution to the house and that (possibly) without Party's B contribution, Party A would not be able to maintain possession themselves (ie. couldn't carry the mortgage).

Future, and amounts Party B paid to the mortgage, reducing the o/s balance, should be taken into contemplation as their payments have reduced the owed on the house and increased the remaining equity in it.

[mcdreamy]

HD, she advised that any further contributions made by him to the matrimonial home following the date of valuation would be dealt with on equalization, not as a percentage or potential interest in any increase/decrease of value following date of valuation.

It is an interesting question -- I would speculate that our matrimonial home will only increase in value. Real estate in our area is not falling.

[HammerDad]

HD, she advised that any further contributions made by him to the matrimonial home following the date of valuation would be dealt with on equalization, not as a percentage or potential interest in any increase/decrease of value following date of valuation.

That makes a lot more sense than saying that they are not entitled to anything if it is one spouses name.

The main question on entitled to growth will be the amount of appreciation and length of time since the valuation. If the value of the house has increased only nominally (like the valuation was done 6 months ago or so), then the argument to go off an amount other then the value as of the valuation date is weak.

But if the valuation was done 2 years ago and your city has saw a boom in housing price increases, your ex will probably argue that they should be entitled to increased value as their portion of the mortgage contributed to such gain.