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  • Settlement Conference question

    Good morning All,

    I have a question about Settlement Offer. I would like to offer her the house in exchange of saving my pension.
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    Facts: House has $53,000 equity, and I owe $76,000 in equalization most of that equalization is mostly my work pension. I have been told to preserve my pension.
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    Would this be a good offer, if she sells the house on her own it would be the cash that she gets out of the sale.
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    I am self representing and she has a Legal aid lawyer who is a ….. well you get the message.
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    What I am looking for is how to write this up as to not get screwed, I have looked everywhere for an example but cannot find a thing I do have the form for Settlement Conference.
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    Can anyone guide or kick my but in the right direction; this site is awesome by the way so much info and hours of looking thru it.
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    Or any other info on preparing a settlement conference would be greatly appreciated.
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    Cheers

  • #2
    You owe 76k but want to offer her 53k, and want to know if that's a good offer?

    That's a terrible offer, why do you feel it is a good offer? The only person it benefits is you.

    Comment


    • #3
      Oh, I don't know. They are not monetarily equivalent, no, but she gets an asset she can sell at any time, and he is stuck waiting till retirement to access his asset. Maybe she loves the house and it is worth it to her to take a bit of an equalization loss to keep it instead of having to sell it. Maybe there are other assets he can add in to make it fairer.

      It doesn't hurt him to make the offer and see what the response is.

      As far as I know there is no form for making an Offer to Settle, though a search around here will produce some guidelines.

      Comment


      • #4
        I don't think it's a terrible offer. The valuation of a pension is easy, the valuation of a home is a guess. She could easily get another $20k on a potential sale and it all goes to her pocket.

        In addition, if she wants to settle this may be a good deal for her. Clean and quick is worth something to her.

        Comment


        • #5
          I agree. The numbers don't balance ($76K owing vs $53K in equity), but it may be an advantage to the ex to either be able to keep the family home, or to sell it and get the cash quickly. This all depends on the state of the real estate market and the priorities of the ex. I can't see any harm in making the offer (perhaps sweetening it a bit with some other financial goodies to offset the discrepancy in monetary value), bearing in mind that it would be completely reasonable for ex to turn it down.

          I believe an offer to settle consists just of a piece of paper with "offer to settle" written at the top, and then a very detailed description of what you are proposing and a time frame by which you would like a response.

          Be sure to be absolutely explicit that if she accepts your offer of the equity in the house, she is agreeing that she will not make any claim at any future time on your pension (and you will not make any claim on hers). Also be explicit that what you are proposing is simply a pension-for-equity swap - there may be other issues on the table (child support access, etc) which are entirely separate from equalizing assets and cannot be dealt with by equity and pension deals.

          Comment


          • #6
            And I would (personally) be very hesitant to self represent. Does your ex have a lawyer?

            You wash away a lot of risk if you use a lawyer carefully.

            Comment


            • #7
              Thanks everyone for your answers so far.

              I have worked out some numbers so here goes.

              We did our equalization and in the end I owe her 76,090.

              So the house was appraised at $270,000, we have $194,865 left on the mortgage.

              The joint credit line is at $25,227.

              So if I deduct the appraised with what is remaining on the mortgage I get $75,134 and from this I subtracted her half of the credit line for a total of $62,520

              Now I still owe her my half of the credit line which I have a Lira worth $15,225.

              Now when I add the two together the final number becomes $77,745.

              Question does this look OK or did I miss something and I am totally out to lunch??

              Thanks

              Cheers

              Comment


              • #8
                payout penalty & fees on mortgage? Bank or real estate appraisal?

                If I were here I'd say give me the house and you can look after the other stuff. Of course alot depends on the legitimacy of the appraisal.
                Last edited by arabian; 12-13-2013, 10:35 PM.

                Comment


                • #9
                  Would she be able to get a mortgage on her own? My spouse made this same deal with his ex. She never was able to get mortgage in her name & it resulted in years of hassle & lots of $$ till she was finally forced to sell the house.

                  Comment


                  • #10
                    Canuck1965, remember she also own half the house so basically you are offering her very little.

                    Your offer looks like only 11,500k. if her intention is to sell the house, it is a bad offer since there is fee to consider and often you end up with less than the appraisal.

                    Even she want to keep the house, 11k is not worth it on giving up a pension share or retirement saving, which is worth more than the house itself.

                    Comment


                    • #11
                      Correction, actually you offer does not offer her equity.

                      In order to make it a fair offer you would have to pay her 13,045K or keep the full amount of the credit line for her to take the house.

                      House value share is 24,954
                      you pension is 76,000
                      your equity =100,954

                      Her equity = 24,954 --- does she have any retirements saving/pension?
                      you owe her 38,000 - house value 24,954 = you are missing 13,046

                      You also mention a credit line and a LiRA ( you have to put the value of your LiRA in the equity as well for division.

                      I you want to give asset as equalization, you may consider taking the full credit line payment.

                      Comment

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