Bad Economy Makes Divorces Tougher
Monday, September 29th, 2008A recent article in the American Bar Journal confirms what Dallas divorce lawyers are seeing — the downturn in the economy is making divorces more difficult. For many couples, their primary assets are the house and the 401K. House values are declining and so the asset is not worth as much to the divorcing couple. Also, the physical division of a house as an asset is more difficult because home sales have slowed and mortgage refinances are more difficult to get. This makes it more difficult for a spouse to receive the division of the equity from that asset. Some couples are already so heavily mortgaged that there is no equity in the house, so when the value falls, they may have negative equity.
With the sharp declines in the stock market, 401K values are also tumbling. This leaves less to divide of a normally fairly liquid and divisible asset.
In many cases, a divorce that would have once been a split of an estate with a positive net worth is now an argument over division of debts. Some couples are even staying together because of the bad economy. Or… worse… getting a divorce, but continuing to live together.
