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If you’ve separated from your spouse or partner, you might be wondering if you should get a separation agreement sussed. Whether or not your break-up is amicable, it is important you have all the facts before you make your final decision on getting a separation agreement.
The Family Home: the facts
The house that you live/lived in with your partner is called the “Family Home” and is to be divided 50:50 between the couple. This is regardless of whether you owned it for 20 years before you entered into the relationship, or whether your partner put in $200,000 from his or her old house, or you pay heaps more towards your mortgage payments. As you can see, it’s not about contribution, it’s about equality, and if you want to ensure that your separate contributions are recognised, we recommend you get a separation agreement.
The 2 Year Rule
You’re probably thinking “it’s ok, we’ve made our decisions and we’re happy with them”, and if so, that’s great, but you need to bear in mind this rule. If you don’t have a separation agreement or a court order, each party to a relationship that has separated has 2 years to seek a division of relationship property, even if the relationship property is already informally divided. This means that even if you got the vintage CDs (or vinyl), the mustang and 70% of the house, your former partner could decide that he or she didn’t get enough when he or she got the dogs, the bach, the boat and 30% of the house and he or she could still come back for a further division. It can become a long, drawn out process when nothing is signed and certain, and that can be a worry. The most amicable of break ups can turn nasty without notice, and closure by having a separation agreement is the best way to avoid this.
The Never-Ending Debt
You cut up the joint credit cards, but did you also cancel the account? A separation agreement provides for all joint debts to be cleared, or taken over by one party, and provides an indemnity (like a shield) for that party not taking over the debt. It happens more often than you think that credit cards, hire purchases, and other debts are left in joint names, and years later you are landed with a huge debt and a bad credit rating because of relationship debt. It’s about getting some certainty now, to avoid a mess later.
Get a Clear Record
A separation agreement is useful in so many ways. It deals with the issues raised above, it allows for certainty, it ensures your separate property stays your separate property, and probably most importantly, it helps to give parties closure. At least one, if not all, of these factors could apply to you so it is important that you carefully consider all the issues before you decide you don’t want a separation agreement.
Disclaimer: The information on this page is general information only and must not be relied on as legal advice. Legal Beagle is not a law firm or a substitute for a law firm. We are unable to provide any kind of advice, explanation, opinion, or recommendation about possible legal rights, remedies, defences, options, selection of legal documents or strategies.
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