It is vital first of all that if a third party has an interest in your property that this interest is protected. This can either be done by a charge or a Declaration of Trust. These provide good evidence that someone else has an interest in the property and should be in place ideally long before the wedding – the sooner beforehand the better.
A pre-nuptial agreement is another method for setting out each party’s interest in a property in a formal document.
Marriage and third-party property ownership
If you brought your property alone or with your now fiancé and your family had gifted you money either for the purchase or towards the running costs you should have a Declaration of Trust in place to protect those contributions. However, even with a Declaration of Trust, getting married means the court is not bound by the terms of the declaration if the marriage breaks down.
On marriage breakdown both parties have identical claims in relation to finances and when considering financial arrangements between spouses the Court will consider the income of the parties and the matrimonial assets – i.e. any capital owned by either spouse – in their sole name or jointly by both spouses. Therefore all assets form part of the pot for division.
On divorce, the Court has the power to make a number of different orders to include:
- Maintenance payments: such as spousal maintenance which are regular payments from one former spouse to the other for a specified period of time.
- Lump sum payments: money to be paid to the other spouse
- Property Adjustment Orders: which transfer property or a tenancy into the name of one spouse only.
- Order for Sale of Property or Assets: to generate money which can be divided between the spouses.
- Pension Sharing: a share of either spouse’s pension to be transferred to the other
The Courts do not apply a set formula to financial cases but consider a range of factors with a view to making an Order that the Court considers is most suitable in the particular case; however the starting position when considering the division of assets is an equal division to each spouse. The Court then considers whether there should be a departure from equality taking into account all of the factors.
The Court considers all the circumstances of the case and gives first consideration to the welfare of any children of the family under the age of 18. The Court then consider the factors listed in Section 25 of the Matrimonial Causes Act 1973.
Given the Court’s wide discretion to divide the assets on divorce a pre-nuptial agreement should nearly always be considered.
A pre-nuptial agreement can set out intention for a property. For example, if the parents of one spouse gifted a deposit or have a mortgage interest in the property, then a prenup should acknowledge both spouses’ agreement that the value of this share would be honoured if the marriage ended in divorce.
Wellers Law Group property solicitors
Wellers’s family lawyers can assist in the drafting of pre-nuptial and post-nuptial agreements so that any third-party interests in a property are protected.
We have offices in London and the Southeast but are able to provide legal advice and services to clients from across the UK. For more information about how we may be able to help, contact us today.