April 1, 2025 • 58 mins
Are you a woman going through a divorce and worried about your future? You're not alone! Many women face uncertainty and fear when their marriage ends, but it's essential to remember that a stable future is within reach. In this episode, moderated by Hunt Law Firm Senior Attorney Melissa Masoom, we'll discuss the steps you can take to rebuild your life, regain your confidence, and create a secure financial future. Listen to learn how to take control of your life and create a bright, stable future for yourself after divorce.
Topics Covered ▶
✔️ Dividing Property and Assets
✔️ Understanding Community Property
✔️ Building Financial Stability
✔️ Steps to Homeownership
Featuring Our Expert Panel ▶
👩💼 Elizabeth Morrison – Certified Divorce Financial Analyst, Love Financial Group
🏠 Shelley Mitchell – Certified Divorce Lending Professional, Mitchell Mortgage Team
🔑 Jennifer Francois – Certified Divorce Real Estate Expert, Francois Property Team
FOLLOW ▶
Web: https://www.familylawyerkaty.com
Facebook: @huntlawtexas
Instagram: @huntlawtexas
X/Twitter: @huntlawtexas
YouTube: @huntlawtexas
This podcast is intended for informational purposes only and is not intended to be legal advice. The information in this podcast is not intended to and does not create an attorney-client relationship.
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Transcript
Episode Transcript
Available transcripts are automatically generated. Complete accuracy is not guaranteed.
Speaker 1 (00:08):
Good afternoon everybody.
My name is Alex Hunt and I'mthe managing attorney of Hunt
Law Firm.
We're a law firm dedicated tofamily law and our family law
clients.
We serve clients throughout thegreater Houston area.
I'd like to welcome everybodyto today's live chat Building
Stability for Women Property andFinancial Guidance After
Divorce, which is also beingrecorded for our podcast, the
(00:31):
Texas Family Lawyer Podcast.
When this episode is published,it'll be our one year
anniversary since we started thepodcast, and it has been an
incredible experience being ableto have these really deep
conversations on the podcastevery month with attorneys and
financial analysts other expertsin their field about how
(00:52):
regular people, whether theyhave experience in the family
law system or not, can approachfamily law, divorce, child
custody, estate planning issuesin the most effective and
cost-effective way possible.
If you're watching this live onYouTube or Facebook or LinkedIn,
please join our conversation.
Take a minute to look up thepodcast.
(01:12):
Wherever you listen, it'scalled the Texas Family Lawyer
Podcast and if you are watchingon one of those platforms,
please send us in your comments.
We'll be able to ask ourexperts those questions at the
very end of our one-hour seminarToday.
We have assembled a veryspecial panel of experts for our
(01:34):
conversation and I'm reallylooking forward to the
conversation.
And to help moderate ourconversation, I'll hand the
reins to Hunt Law Firm SeniorAttorney Melissa Massou.
Thanks, everybody.
Speaker 2 (01:47):
Thank you, alex.
Good afternoon and welcome tothose of you who are joining us
today.
My name is Melissa Massou and,as Alex mentioned, I am one of
the two senior attorneys here atHunt Law Firm.
I've been at Hunt Law Firm forabout seven years now, and
today's subject matter issomething I've been wanting to
present on for years.
(02:08):
I started as a family lawyer,primarily helping women in
difficult situations involvingphysical abuse, financial abuse
and or emotional abuse.
There are just so many women inthese abusive or just
(02:29):
financially disadvantagedsituations who just don't know
what they can or cannot do in adivorce, what their rights are
or who even to speak to.
So that is the goal for today.
I want to give the audiencemembers some crucial information
that will help you allunderstand your rights, your
options and what you can do in adivorce and what you can't do
in a divorce, and maybe give youjust a little bit more peace of
(02:52):
mind after all of this is doneWith that being said, let me
introduce you to our expertpanelists today.
So thank you, ladies, first ofall, for taking the time to join
us today.
First we have the lovelyElizabeth Love Morrison of Love
Financial Group.
She is a certified divorcefinancial analyst, or CDFA.
(03:15):
We also have the incredibleJennifer Francois of Keller
Williams, our certified divorcereal estate expert, or CDRE.
We have the brilliant ShellyMitchell of Divorce Equity
Solutions, who is a certifieddivorce real estate expert, or
CDRE.
We have the brilliant ShellyMitchell of Divorce Equity
Solutions, who is a certifieddivorce lending professional, or
CDLP.
And last but certainly notleast, we're joined by Brie
(03:35):
Holcomb.
She is Hunt Law Firm's leadattorney of estate planning and
probate.
Welcome, ladies.
So I want to start withElizabeth.
Welcome, ladies.
So I want to start withElizabeth.
Elizabeth, this is a questionthat I get a lot when I
recommend people talk to acertified divorce financial
analyst.
When should a woman seeking adivorce speak to a certified
(04:00):
divorce financial analyst?
What part of the process?
Speaker 3 (04:03):
Hi, thank you for having me today, melissa.
Let me start by explaining whata CDFA is.
A CDFA is a financialprofessional who specializes in
divorce-related financialmatters, so most CDFAs are
financial advisors like me whoare also experts in financial
(04:25):
planning and personal finance.
Many divorcing people are in ahighly anxious state because
they don't know where to start,and a CDFA can tell you what
information you need to get thefinancial piece of your divorce
organized and ready forsettlement or trial.
(04:46):
This can bring comfort toclients who feel buried in
numbers or not sure where tostart, or are wondering if they
will be able to financially liveon their own.
Several people stay in anunhealthy marriage because they
fear that financially they willnot be able to support their
(05:08):
lifestyle.
Meeting with a CDFA even beforeyou file can help ease those
concerns or fears.
Speaker 2 (05:16):
Excellent.
Thank you, elizabeth.
Yes, oftentimes in myconsultations with women who are
nervous about their financialsituation, I tell them to go
ahead and contact a CDFA ASAP,even if they're not ready to
file with us, so they can easetheir minds a little bit.
Get prepared, elizabeth.
I think a common misconceptionabout speaking to a financial
(05:39):
analyst is that you have to havea large number of assets to
speak to one, but that's simplynot true.
Can you tell the audience whatyou would do first?
Say a woman walks in to youroffice and she's contemplating
divorce or already in thedivorce process.
What would you?
Speaker 3 (05:57):
tell them?
Yeah.
So that's another greatquestion, melissa.
I want to start by addressingthe comment on maybe not having
enough assets.
So there's a difference betweenCDFA work and investing assets
in the market, and most CDFAsdon't have any sort of minimum
(06:18):
for assets.
We're here to help you throughthat divorce process.
Help you through that divorceprocess.
So some things that I reallymake sure to address.
First one is a budget, somaking sure that my client has
(06:40):
an idea of what their budget isbefore they get divorced and
after, and so there's usually alittle bit of a shift because
now it's just you and maybechildren, but knowing what those
big expenses are is a goodplace to start.
Sometimes I say the word budgetand it can be overwhelming, but
most CDFAs will have a templatefor you to be able to use and
have that, and knowing what sortof income you're going to need
(07:02):
to maintain that same lifestyleis important.
Another key thing that wediscuss is knowing your assets.
So if there's an asset that youdon't understand, or maybe
there's an asset that you havequestions on, make a point to
try to understand that.
If you haven't filed yet, Iwould start making a list of
(07:26):
what you know, and even if youhave filed, but maybe you're in
the early stages and you haven'tmet with a team yet, it's
important to know what yourassets are and if there's any
debts that are linked to thoseassets.
And then the third thing issetting goals.
So sometimes that can seem kindof overwhelming to think about
(07:46):
what a financial goal may beafter or post divorce.
That that will help you asyou're moving through this
process, to know what you'reworking towards is building your
team, whether that's yourattorney or maybe a friend, a
counselor, a CDFA.
(08:06):
Have a team around you that'shelping support those goals and
needs that you have.
Speaker 2 (08:12):
Thank you.
Yes, budgeting is a very scaryword for a lot of our clients
and you know.
Budgeting with a CDFA orbudgeting period before even
walking into a divorceattorney's office or filing for
divorce is so important becausewe will need that information
(08:33):
and we'll need to know, well,are we going to try and go for a
spousal support or temporarysupport of some kind right away
because our client needs it, orare we okay, moving forward and
it'll help establish the goalsfor your divorce sooner rather
than later?
So budgeting is just really,really important.
(08:56):
So, elizabeth, what are somethings you, as a CDF, face as
challenges for women in thedivorce process?
Speaker 3 (09:02):
Yep, that's another good question.
I think there's a couple ofthings that really come to mind.
The first thing is a lack ofknowledge or maybe just being
really unsure of the questionsthat they need to ask.
It's common for women to haveto learn a whole new set of
financial skills after divorce.
(09:24):
Maybe they weren't in charge ofthe finances or they just
didn't pay as much attention tosome of the details.
I come across this a lot, withwomen feeling like they should
already know the answer or beembarrassed to ask.
My goal is to help empowerwomen to understand their
current situation better and theskills that they need in a
(09:49):
nurturing way where they feelempowered.
Another one is maybe lack ofresources.
A woman may walk away with youknow, quote half of the assets,
but her earning power might bedifferent because she stayed at
home with the kids or has alwayshad a lower paid employment.
(10:09):
So sometimes that means alifestyle change is needed, and
sometimes that just means somecareful planning.
So my job as a CDFA is to helpwomen navigate this and make
choices that fit the lifestylethat she's wanting and
accustomed to.
A third challenge that I seesometimes is a settlement that
(10:32):
doesn't fit.
So if the settlement wasn'tcarefully crafted.
A woman may walk away withassets that she can't afford to
maintain, like a house, orassets that she can't access
like a 401k or a pension, butsometimes that may set her up
for failure in the future.
(10:52):
But I hope to prevent that kindof thing from happening.
And the last thing that I seethat's somewhat common is
becoming fixated on oneparticular asset.
I see that a lot with themarital home and women in
particular becoming afraid thatthey will lose their home or be
unable to afford it afterdivorce.
Speaker 2 (11:13):
Yes.
So we, as the divorce attorneysyou know, have to deal with,
you know, all of these assets,and the biggest asset in most
divorces is the marital home.
Like steps do they need to taketo figure out their options and
(11:45):
avoid making emotional orfinancial missteps?
Speaker 4 (11:50):
So, as a certified divorce lending professional, I
specialize in guiding divorcinghomeowners women through divorce
, property division and mortgagesolutions.
And one of the biggest mistakesI see is people fighting to
keep the marital home withoutfully understanding that they
can afford to keep it and evenqualifying for the mortgage on
(12:15):
their own.
And unfortunately, many womencome to me after the divorce is
finalized and I have to deliverbad news.
You know that they can'tqualify to keep the home or
maybe they're going to do anequity buyout to buy out their
spouse and they now can'tqualify.
So this is why I offer a freedivorce mortgage planning
(12:38):
consultation where I analyze thehome with what I call a real
property report, and this reporthelps divorcing homeowners
determine if they can afford tokeep the home, buy out their
spouse or if maybe selling andpurchasing a new home is a
better option.
And I review income, assets,debts, any maybe child support
(13:01):
they're going to be receiving inthe future once the divorce is
final and any spousal supportyou know we don't see a whole
lot of spousal support in Texas,but sometimes maybe maintenance
support Create a realisticfinancial plan.
And for women that are unsure ifthey can keep the home, the key
is really planning early,getting with me before they're
(13:23):
heading to mediation, before thedivorce is final.
First, they want to reallyunderstand the financial picture
, gather financial documents,including mortgage statements
and tax returns, credit reports,things like that.
Secondly, determine the home'sequity and whether an equity
buyout is going to work orrefinancing is even an option.
(13:45):
And thirdly, work withprofessionals you know whether
it's a CDLP like me or a CDFA toensure keeping the home even
fits in the long-term financialgoals.
So most importantly is don'tlet emotions drive the decision.
So while you know the home mayhold sentimental value, you need
to consider whether it truly isaffordable post-divorce.
(14:07):
And starting the divorcemortgage planning process early
ensures they're going to makeinformed decisions before
finding the final divorce decree.
And so you know just reallyneeding guidance and that's what
I'm here for and helping put asolid plan in place before the
divorce is final.
Thank you, shelly.
Speaker 2 (14:27):
And Shelly, as a CDLP , have you had people come to
you thinking that theyabsolutely cannot afford to keep
the home?
But they came to talk to you,just to talk to you, and they
realized they can in fact keepthe home if they wanted to.
Speaker 4 (14:41):
Absolutely All the time actually.
They wanted to Absolutely Allthe time actually.
So I've had many clients cometo me thinking they can't afford
to keep the home, only torealize that with the right
strategy they actually can keepthe home.
So a big part of my job as aCDLP is helping homeowners see
the full financial picture, notjust what's in front of them at
(15:02):
that time.
And so many assume, you know,they can't qualify for a
mortgage on their own.
But once we factor in incomesources, you know whether it
maybe be like child support,maybe maintenance support or
even creative financingsolutions.
The numbers can really tell adifferent story and that's
(15:23):
another reason getting withsomeone you know a CDLP or CDFA
early in the game is reallyimportant.
So, for example, I had arecently I worked with a woman
who was ready to sell becauseshe assumed she wouldn't qualify
for a mortgage after herdivorce.
But after reviewing her incomeand her assets and just
(15:45):
structuring all of herdocumentation of her divorce
settlement, we found a way touse her support payments as
qualifying income and with arefinance and some smart debt
restructuring she was ableactually to keep her home
without overextending herself.
So you know, that's why it's soimportant to consult with a
CDLP before finalizing thedivorce and we can structure the
(16:09):
settlement in a way thatimproves mortgage eligibility
and financial stability.
Sometimes it's not about whetheryou can afford to keep the home
, it's about having the rightfinancial strategy in place to
make it happen.
So for anyone on this podcastwith us today, if you're unsure,
you know let's have a talk.
You know it's free to have thatfree consultation, and a
(16:30):
divorce mortgage planningconsultation can give you a lot
of clarity and help make theright decision for your future.
Thank you.
Speaker 2 (16:39):
And I believe Elizabeth mentioned this and
then you know seeing theconnection having a team right,
because if you talk to Elizabethearly in the process, when you
talk to Shelly now, you have allyour resources and budget run
and now you're talking to Shellyto get an idea of what you know
(17:01):
your options are, and yourdivorce attorney can also step
into that conversation andfigure out the legal strategy of
how we're going to get thoseassets.
So, working as a team which wedo do at Hunt Law Firm, these
are all women that we work with.
You know to make sure that ourclients are taken care of from
(17:23):
every single perspectivefinancially.
So say, someone comes to you,shelly, and has done all that
work and you realize thatrefinancing or a buyout is an
option for this client.
How long does this processusually take?
Speaker 4 (17:41):
So the process is going to.
You know it depends Are theygoing to do a buyout or are they
going to purchase.
A buyout typically is going totake about 30 to 45 days,
depending on if we've startedthe process early, before the
divorce was final.
So I say 30 to 45 days.
There's a pre-qualificationprocess, there's an application
(18:02):
process.
You know an appraisal needs tobe ordered.
We've got underwriting, gotyour final approval, you've got
closing, you closing some legalsteps and so forth.
But you could be looking atsome potential delays can come
from waiting for finalizeddivorce decree, support payment
(18:23):
documentation.
When you're waiting for, maybe,child support to kick in.
There is a three-month waitingperiod on something like that.
Maybe you know you could havesome title issues, but for the
most part 30 to 45 days for abuyout and that's why starting
early is always the key part ofit, before the divorce is final.
Speaker 2 (18:43):
It helps to prevent any type of stress and then it's
going to ensure smoothtransaction of stress and then
it's going to ensure a smoothtransaction Right, and it also
helps if you are sitting in amediation, like you're divorce
determining, knowing you knowwhat that timeline is.
So we don't go ahead and agree.
You know, sometimes the otherside will push for a 30 day
(19:05):
buyout situation and if I'mtalking to you, shelly, I know
well that's not possible, sowe're not going to agree to that
, and it helps a lot.
Thank you so much, shelly.
So, jennifer, I kind of want togo to you next.
So many people in our audienceand I get this question a lot
(19:26):
when I talk about, you know,talking to a CDRE when there is
a marital home evolved, what isa CDRE and why are CDREs so
valuable during a divorce?
Speaker 5 (19:38):
Thanks for having me.
By the way, I'm happy to behere.
I've been in real estate for 22years and I've always sold
different types of housing.
So over the years I run intomany families, women who are
going through the most difficulttime in their lives and it
became apparent to me that if Iwas going to provide the highest
level of service, I needed toincrease my education, which it
(20:00):
was then that I decided topursue the designation in
divorce real estate.
And what makes us different is aCDRE is trained extensively on
selling real property and familylaw cases and to do so as a
neutral, unbiased third-partyexpert.
We're also required to adhereto a stringent code of ethics to
ensure a smooth and successfultransaction, supporting all the
(20:24):
parties equally and ensuringthat the orders of the court are
followed.
We also act as a witness incourt and we're trained to
testify when needed.
So frequently divorce realestate sales they're highly
emotional and ensuring thateverybody feels fully supported
through the time and, with aneutral, unbiased third party,
(20:47):
it ensures that we have a smoothand successful transaction.
Speaker 2 (20:51):
Great and you mentioned being involved, very
involved, in the process ofdivorce, being a witness and all
of that.
I know from talking and workingwith Elizabeth and Shelly.
Y'all also can be a part of themediation process and a part of
all of that as well.
So it's like I said, it's justso important, if you're talking
(21:13):
about financial stability anddivorce and what you can and
can't do, to have that teamaround you so that every step of
the way you have you know thisgreat team that can even sit on
in mediations with your attorney, so that you're getting the
absolute best you know possibledeal and you're you're sitting
(21:37):
there knowledgeable and not kindof in the dark.
So, jennifer, if someone comesto you wanting to buy a new home
without their spouse on thepaperwork so we're going through
a divorce, or they haven'tquite even filed for divorce
what do you tell them?
Speaker 5 (21:56):
Yeah, so this happens fairly regularly.
Everybody's trying to makeplans for their future and
there's just a process involved,right?
So first and foremost, I wantto understand at what phase they
are in the divorce.
Have they even filed?
Did they purchase the home?
If we're selling a home andthey want to sell before we file
for divorce, did they purchasethe home jointly?
(22:19):
A lot of times I have to educateon community property and what
that means.
As Texas is a communityproperty state, it means that
all assets obtained during themarriage would be subject to
joint ownership.
So if you purchase a home priorto finalizing your divorce,
that could definitely cause somechallenges.
So I work to gain knowledge.
(22:40):
I like to engage the attorneyand understand if there are
court orders regarding themarital property, regarding
future housing requirements, ifthere's children involved and
where those homes may need to be.
So usually, the best next stepreally is to meet with a CDFA
and a CDLP to evaluate what theavailable options are and ensure
(23:01):
that we're following the rightprocess, because we don't want
to put the cart before the horseand get ourselves into a sticky
situation where there's anasset obtained during a marriage
that wasn't obtained in thecorrect manner, and protect the
client from that.
Speaker 2 (23:16):
Right and we always Brie will attest to this as well
we always advise our clientsnot to buy that home or try and
buy a home during the divorce,unless it's absolutely necessary
, unless the other side is 100%on board, unless we have an
agreement on paper that how it'sgoing to be divided, et cetera,
(23:40):
because it does create so manyissues.
Speaker 5 (23:45):
It can be done, but not well and not easily.
So it's just it's smarter towait for sure.
Speaker 2 (23:52):
Now, as a CDRE, can you give the audience some tips
as to what someone who needs tosell a home should be doing to
maximize that home's?
Speaker 5 (24:00):
value Absolutely.
So, most importantly, the bestfirst step is really to conduct
a home visit so that I can, oranother CDRE can, evaluate the
condition of the property andmake recommendations, because
what we don't want is you to goand spend a bunch of money or
time on something that will notprovide a returnable value in
(24:22):
the marketplace If the client isnot ready for a home visit.
Best first steps always includeperforming general maintenance
on the property.
Things that I see that areoften not done are performing
regular AC and roof maintenance.
Those can be very expensiverepairs that could become a
(24:45):
problem during a sale.
So making sure thosemaintenance items are done and
that we know of any existingsituations ahead of time and
then addressing them, repairingany known defects or things that
the family knows don't functionbefore going on the market is
absolutely the best step as well.
(25:05):
So then you have things likedecluttering, depersonalizing as
well.
So then you have things likedecluttering, depersonalizing,
doing a really good, deep, clean, power washing driveways and
back patios.
Anything that you can do toimprove the physical condition
of the property is ideal,because that's going to allow us
to maximize what we can getwhen we sell the property.
So, as I mentioned, I don'trecommend investing in any
(25:26):
upgrades or updates before aproperty visit, as I want to
make sure that my clients arespending their money wisely.
That will improve the value andthe resale potential of the
property.
And then if there are, if thereis work or repairs that need to
be made or items that we coulddo that would improve the value
and there's not funds availablefor that, then we do also have
(25:50):
some resources available or wecould get creative when needed,
so those are always an option.
Speaker 2 (25:55):
Great, thank you.
So in today's market which hasbeen a little bit crazy what
would you say to someone who'slooking for a realistic timeline
as to selling or buying a home?
Speaker 5 (26:08):
Yeah, so, as with every real estate market, it
ebbs and flows, right.
We've seen a lot of changessince COVID and the market's
kind of had a lot of shifting,but it typically always has a
cycle right.
So, and we're in coming intothe spring cycle, so right now
is a great.
If people are consideringselling.
This is when we start to pickup for the year and we're really
(26:30):
seeing that happen.
So homes that are in excellentcondition are actually selling
really well, and so it'simportant that we prepare for
either scenario for buying orselling, but understanding, you
know, what's happening in thatneighborhood, in that home type.
Every neighborhood is verydifferent.
So it's important that we do areally deep dive and analysis on
(26:52):
what's happening in thatspecific neighborhood, in that
market, because every submarketwithin our, within our area,
sells differently.
So we and we do this byutilizing our resources with our
partners, with our CDFA, ourCDLP and your attorney and the
four of us, as we mentioned,kind of act as a hub of a wheel.
Any missing part of the hubwould not allow the wheel to
(27:14):
function at its highest, at itshighest output.
So having your team andensuring that we're all together
and communicating correctlywill make sure we know what the
ideal timeline is, but once weget a clear picture and we're
ready to list the home or topurchase a home, a good
expectation is usually anywherefrom 45 to 90 days, depending on
where we are in the approvalprocess.
(27:36):
Have we established our budgetsalready?
Do we know what our assets looklike, you know?
Do we have our divorce decreefinalized and know what our,
what our budget's going to be?
Once we're really solidly ready, 45 to 90 days is a good
timeline.
Speaker 2 (27:49):
Great, and so say the parties.
Go through, shelly and Jenniferand both of y'all, and maybe
they've spoken to me as theirdivorce attorney and now we're
ready to negotiate their actualdivorce terms in a mediation.
Elizabeth, I'm going to comeback to you.
(28:09):
What are some common mistakesyou see your clients making when
finalizing those terms of thedivorce?
Speaker 3 (28:16):
So I think the most common thing that I see is not
asking questions.
I touched on this before, butas you're going through the
divorce process, you want tomake sure that you're
understanding exactly what youneed to live off of and what the
(28:38):
settlement is going to be.
A lot of times, like Imentioned earlier, women may
feel embarrassed or like theyshould already know the
information, but knowledge is soimportant as you are dividing
up your family assets.
So ask questions and if you'rein a situation where you maybe
(28:59):
have a team and you don't feelcomfortable asking questions,
then find somebody that you dofeel comfortable asking
questions.
I try to make a point of doingthat with my clients and having
check-ins and making sure thatthey're understanding what we're
talking about.
The second thing is and I knowthis has been touched on today
(29:19):
too is letting emotions cloudyour judgment.
Divorce is a highly emotionaltime, so it's natural to have
those ebbs and flows of emotions, but making sure that you have
a team that's supporting you tohelp you see logically and long
(29:40):
term, which is the next thingthat I see a lot of is failure
to think long term.
It's very tempting to just tryto get to the settlement and
have it over with, but you wantto make sure, especially as
you're putting together yourfinancial future, that you're
(30:00):
looking at well, just dodivision of assets, for example,
and making sure that those aregoing to be able to last you
past the settlement date, thatyou're able to have the income
that you need to support thoseexpenses that you're going to
have.
And, lastly, not getting help,not reaching out.
(30:21):
I've worked with a lot of womenand after the divorce they just
kind of spin out emotionallyand a divorce is a massive
change and it can be very hardto navigate alone.
So just realize that and knowthat there are people here, like
the people in this podcast,that are here to help you
(30:43):
throughout that process.
Speaker 2 (30:45):
Thank you, Elizabeth.
I'm going to go to you, Shelly,and kind of ask you the same
question what are some of themost costly mistakes you've seen
clients make in their finalsettlement?
Speaker 4 (30:56):
Sure.
So one of the biggest mistakesI see in divorce divorcing
homeowners is keeping the homewithout confirming affordability
.
So I see so many fight to keepa home without confirming that
they actually qualify for amortgage, leading to financial
strain or even foreclosure.
(31:17):
Or they fight to keep the homeand within six months to a year
later they're selling their homebecause they realize they
cannot qualify for equity buyoutor it's too much house and they
should actually be selling thehome and not have retained the
home.
The other thing that I see isnot refinancing to remove an
(31:37):
ex-spouse and that ex-spousethat has moved on.
They don't realize that it isstill affecting their credit.
And so the spouse that hasretained the home, if they for
some reason do not make timelypayments on the home, it
actually affects the spouse thatif their name is still on the
mortgage, it will affect theircredit, and so there's some
(32:01):
misconception about that, and sothat is something as well.
And then relying on childsupport, and so lenders require
proof of consistency of paymentsfor three to six months before
even being able to use the andcount it as as income for
qualification purposes.
And so you know, divorcingparents homeowners will come out
(32:25):
of a divorce and immediatelywant to qualify to either one
keep the home for an equitybuyout or want to purchase a
home immediately, and they arerelying on child support
payments and they have notreceived it for three to six
months yet and so they cannotqualify for a mortgage loan.
And then overlooking hidden costof home ownership.
(32:46):
You know it's not just about aprincipal and home ownership.
You know it's not just about aprincipal and interest payment.
You know there's property taxesand homeowners insurance, which
we all know have increasedquite a bit over the years, and
maintenance costs and homeownersor HOA dues.
And that just needs to be takeninto consideration when you
(33:06):
know someone wants to keep ahome.
So just fully evaluate the costbefore deciding to keep the
home and then splitting upequity and considering taxes.
People overlook capital gainstaxes and so of course I'm not a
tax accountant, I don'tpractice law, but I always say
get with a CDFA or a taxaccountant, speak to your
(33:30):
attorney, because you know whenyou're splitting up multiple
homes or maybe investmentproperty, there could be capital
gains and just proper planning,expert guidance and just avoid
these costly mistakes.
Speaker 2 (33:45):
Thank you, shelly, and I also tell my clients I'm
not a tax expert.
You need to talk to somebodywho is, and the tax impact of
certain assets is somethingElizabeth can help with.
But certain assets, like a homeor a IRA or whatever, have
different tax consequences thatpeople don't think about.
(34:09):
So that's something that we tryand think about as your divorce
attorney when we're sitting inmediation, going okay, well, do
you want this or this?
It's going to give you adifferent value.
Really, I mean, on paper itlooks like the same value, but
the tax impact might actuallychange that value, right?
So yes, so thank you, shelly.
Those were all excellent tips.
(34:31):
So, jennifer, I'll go to younext.
Any tips from a CDRE as to whatthe audience should be prepared
with going into a finalmediation from your perspective.
Speaker 5 (34:43):
Yeah.
So a few items that come tomind is the biggest piece is
having a solid expectations onthe value of the marital
property.
Often getting a formalappraisal is helpful.
It's not required, but it'shelpful.
I can also provide a marketanalysis reports, if they're
accepted as means to the partiesto establish value, so that way
(35:03):
we know what that asset couldpotentially sell for.
That way we know what thatasset could potentially sell for
Then be prepared to set a listprice as part of the mediation,
because those terms really doneed to be in writing to avoid
potential future conflict.
Then and we want that writteninto the decree a firm decision
(35:24):
on how the proceeds are to besplit and if attorney's fees
will be held from those proceeds, because it's important that we
have a detailed decision as tohow proceeds are going to be
applied If the property hasn'tbeen sold at the time.
You want to write in thepreferred CDRE's name into the
decree hopefully me and we wantto make sure that we make
(35:47):
decisions on how personalproperty are to be split and how
the outspouse will collect them, because those details are
important for logistics,especially if there's conflict.
Is there a required schoolsystem or county that the
parties are required to live infor the children or distance
away.
Those are things that we needto know and if they're going to
be written into that decree toensure that we make those
(36:10):
decisions so that I can havethose in writing and be able to
hold up the court orders, then,if we haven't sold the property
at the time of the mediation,we'll want to know who's going
to maintain the property Ifneither property is living there
.
Who's going to maintainutilities?
Who's going to do any necessaryrepairs while the property If
neither property is living there, who's going to maintain
(36:30):
utilities?
Who's going to do any necessaryrepairs while the property's on
the market, if there is aproperty to sell?
So there's a lot of detailsthat need to be worked out that
get written into that decree toensure that we don't miss
anything and that we're able toget the property sold and make
the most money for it.
Speaker 2 (36:46):
Now let's pretend the audience has a final decree of
divorce.
We settled in mediation and wehave a divorce decree in hand
that's actually signed by ajudge.
It has the assets divided andthe parties are now officially
divorced.
So, Elizabeth, what do you tellyour clients to look out for as
far as the financial issuesafter a divorce?
Speaker 3 (37:08):
Yeah, so that's something really good to keep in
mind.
A lot of times you know you getto the end of the settlement
and you think, yay, I'm done.
But on the financial sidethere's still quite a few things
to make sure are done andimplemented before you can kind
of rest easy.
So one of those is if you aregetting your ex-spouse's 401k or
(37:34):
maybe a pension, you'll havewhat's called a qualified
domestic relation order andyou'll want to make sure that
that gets processed.
That's something that does nothappen automatically at
settlement.
If you are getting an IRA froma spouse, you're going to want
to make sure that you open up anIRA in your name and get that
transferred.
(37:54):
Again, that's something that Ican help you with as a CDFA, but
it's going to have to be done.
It doesn't just automaticallyhappen.
A couple of other examples wouldbe let's say you're getting a
car and the title was in yourex-spouse's name.
You're going to want to changethat title.
A checking account, I mean.
I always recommend doing thatbefore a settlement date.
(38:16):
But if you don't have one,that's in your need to make sure
that are handled properly afterthe divorce so that you can
transfer those assets into yourname the way that the settlement
states that it should be.
Oh and something else to keepin mind.
(38:40):
It can seem like a lot,something that I recommend is
just having.
I have a list for for all myclients of things to go down,
and so it can seem a little bitmore manageable that way.
Okay, I checked this one off,now this one, and so you're
keeping a list of everythingthat needs to get done.
Then, once you get to thebottom, then you can relax and
(39:02):
celebrate.
Speaker 2 (39:03):
Thank you, elizabeth.
So and you brought up a greatpoint about transferring assets
and making sure everything isunder your name Sometimes our
clients come out of a divorceand they have that divorce
decree in hand and they've neverhad, you know, especially if
they've been in a financiallyabusive situation where they had
(39:23):
no control of their money andtheir assets.
They've never had assets intheir name.
They've maybe never had achecking account in their name
or a life insurance policy intheir name or whatever.
This is where I think estateplanning I think everyone will
agree estate planning is very,very important at the end of
(39:44):
your divorce process.
So I'll bring Brie Holcomb into this conversation Now.
Brie, you're the lead attorneyof Hunt Law Firm's estate
planning and probate section.
How important is it for someoneto do their estate planning
after a divorce and why?
Speaker 6 (40:02):
It's absolutely imperative.
So when you go through adivorce, it's a life-changing
and life-altering event.
Many people compare losing aspouse even though they're still
alive, almost to death.
So just because a divorce hasoccurred, we want to make sure
(40:26):
that our women are takingcrucial steps to ensure that
their new assets that they haveare going to be protected.
It's important to know kind ofat the outset, though if you had
an estate plan that named yourformer spouse as a beneficiary,
as an executor, a trustee, anagent, under Texas law that
individual that husband is goingto automatically be precluded
from serving in those capacities.
There's a reason that divorcehappened and that individual is
not going to be allowed to servein those positions anymore.
(40:49):
The other things that I wouldencourage women to do I've got
kind of four takeaways.
First is to do an inventory ofyour estate.
You know, coming out of adivorce, you may have done an
inventory and appraisement,which is basically a fancy
document that lists all of yourassets and liabilities.
That's kind of what we use asattorneys to help divide our
(41:09):
estate in the midst of a divorce.
In the event that you didn't dothat, maybe you guys had a
peaceful and amicable divorceresolution.
What you can do is just kind ofstart to gather you can partner
with a CDFA what assets do Ihave in my pot and just really
inventory.
These are all of the items thatI have that I need to ensure
(41:30):
are you know now in my estateand are going to the people that
I want them to go to when Ipass away.
And that's going to help youidentify your assets so that
you're able to then.
Step two update yourbeneficiaries.
A lot of accounts thatindividuals have could be
transferable or payable on death.
So after a divorce, youcertainly want to make sure that
(41:51):
your beneficiaries are up todate and that the individuals
that you want to inherit areable to inherit, and so if you
work with a financial advisor,that person can certainly assist
you in updating thosebeneficiaries.
You may be able to do them onyour own through the certain
financial institutions that youhave, and examples of those
(42:11):
payable on death assets could belife insurance policies,
retirement accounts, any otherassets that are transferable or
payable on death.
Step three, I would say, is tocreate your will.
You want to revise that will toensure that your husband is now
no longer a part of it, eventhough again automatically
revoked after your divorce isfinalized.
(42:32):
But you've got to consider, youknow, who are my new
beneficiaries going to be?
If you don't have any children,who is going to inherit my
estate?
If you do have children, who'sthe guardian of that child going
to be if something happened toyou and your former spouse?
Do I need a trust for theseindividuals that are going to be
?
If something happened to youand your former spouse, do I
need a trust for theseindividuals that are going to
(42:52):
inherit from me and who do Iwant to be in charge if and when
that time comes and I pass awayand somebody is going to have
to, you know, step in andfacilitate the distribution of
your estate?
And, lastly, I would say thefourth thing that women want to
make sure they do is updatingtheir plan for incapacitation.
You know, oftentimes we're veryfocused on well, what happens
when I pass away, but therecould be many instances where
(43:14):
you become incapacitated andcannot make decisions for
yourself.
If you are married, your spousemay be able to step in and take
ownership and take action, butif you are divorced, we need to
appoint individuals to ensurethat you know a plan is going to
be in place if somethinghappened to you and you're alive
, but you can't make decisionsfor yourself, so it's very
(43:35):
important for women to considerall of those things.
The other tidbit that I'llleave you with is you know,
oftentimes women get remarried,and that's a wonderful and a
beautiful thing, but when we'replanning for our next estate and
you've got blended families, wedefinitely want to take into
consideration well, whatseparate property do I have?
What community property isgoing to be created?
Should I get a premaritalagreement or a postmarital
(43:58):
agreement?
Those are all things that we,as estate planning attorneys and
family law attorneys, cancertainly talk through to ensure
that you are protected afterdivorce.
Speaker 2 (44:08):
Thank you, brie.
So we have a couple ofquestions, so we're going to
switch to the questions part ofthis, and so I will start with
Elizabeth.
This question is for you howcan I create a post-divorce
budget that reflects my newfinancial reality?
What are some tips you have forthat?
Speaker 3 (44:29):
That's a good question.
So I would start with expensesthat you know you're going to
have cell phone, eating you'vegot to eat, right and I would
take a look at kind of what yourbudget is before the divorce so
married I don't know if youhave kids or not and kind of
estimate what would that be onyour own and these are estimates
(44:52):
, right, because you don't knowexactly what it's going to be
until you're living on your ownA CDFA, like myself, can give
you some good guidelines andparameters, because we've seen
people do it and we have prettygood estimates of, depending on
where you are in life, kind ofwhat those numbers would be.
Another thing to consider is areyou working or not?
(45:13):
If you are, what is that incomegoing to be?
Are you going to need childcare?
Are you going to have to goback to work after this?
Will you need child care?
Things like that.
But that's where I would startis with things that you know and
then work your way from thereand, like I said, a CDFA is
(45:34):
going to have the resources tobe able to help you with sheets
and templates and estimates thatwe've used with other clients.
Speaker 2 (45:41):
Great, thank you.
Our next question and this cango to Jennifer are there
strategies to make the homeselling process easier if I have
a reluctant spouse?
And this is somethingJennifer's trained in as a CDRE.
Jennifer, take it away.
Speaker 5 (46:02):
Yes.
So that's a great question andthat's definitely the most
difficult part is when we're notin agreement on how to manage
the marital property.
First and foremost, it's superimportant to work through with
your attorney to hopefully cometo terms during mediation and
(46:22):
gain agreement and get thoseagreements in writing Ways to
make it easier.
So I offer a consultation toall of my clients, whether it's
going through a divorce or justa traditional sale.
But I like to meet with eachparty separately.
That way they have the abilityto speak freely and I can help
(46:48):
them through the decision andunderstand and really connect
with them independently.
As I mentioned, maintainingneutrality is absolutely the
most important piece, becauseeverybody wants to feel heard
and understood.
And when I'm able to hear allsides of what's going on and
then really just look at thefacts and the details and then
(47:10):
have a conversation with theattorney to know where we are,
what do we need to, what do weneed to do, what steps do we
need to take and ensure thatwe're all on the same page, then
I will usually inspect theproperty as well with the
in-spouse the person that'sliving there and then take some
photos of the property, becausesometimes there is the
(47:31):
out-spouse that's not seen theproperty in a while and they may
need to understand what thecondition is, what the condition
of the market is, and justreally take time to educate, and
usually, once you provide ahigh level of education and
support, we're usually able tocome to agreeable terms.
It might take a fewconversations, but we usually
(47:52):
get there.
Speaker 2 (47:53):
Great, Thank you.
The next question is how can Iprotect my credit during and
after a divorce?
I think this could go toElizabeth.
Speaker 3 (48:11):
I think this could go to Elizabeth.
I got one.
Go for it.
So the first thing that I wouldsay is I don't know what stage
this person is in in the divorce, but even before you file, I
would recommend having aseparate credit card and opening
up your own checking andsavings accounts and having
things in your name.
Now, that is not going tonecessarily help if you have a
(48:33):
joint credit card, but I know onthe legal side, I think once
you file, those can be frozenand so hopefully they're not
charging up the credit cardafter the filing has happened.
But my biggest recommendationis to make sure that you're
(48:53):
starting to transition thingsinto your own name and you're
building your own credit.
Speaker 2 (48:59):
Thank you.
Thank you, elizabeth.
Okay, the next and possiblylast one we have is and I'll
actually go to Brie for this one.
I think it's a good one forBrie Do I have to live with my
spouse while the divorce ispending?
Can I move out or force themout?
(49:21):
Brie, you can take it.
Speaker 6 (49:23):
That's a good one.
So, first and foremost, it'sreally important to know that if
you leave the marital residence, that does not mean that you
are then precluded from takingthat asset or you are giving up
a portion of that asset.
We oftentimes have clientsleave the marital residence
because they don't feel safe,and we're not going to penalize
(49:43):
anybody for that.
It's also important to knowthat when we're going through
divorce, spouses oftentimescan't be in the same residence
with each other because they'realways bickering or fighting and
it's just not good for mentalhealth.
So do you have to live withyour spouse during the divorce?
The answer is no, and there'sreally not going to be some
major consequence of I moved outof the house.
(50:05):
Now I can't say I want it on afinal order and I'd like to be
awarded that.
Can I move out or force themout?
Yes, you can certainly move out.
The forethought is a little bitdifferent.
In you know family law, weoftentimes don't have major
kickout orders where a spouse iscompletely removed from the
residence, unless there's beensome sort of major family
(50:26):
violence.
But what oftentimes happen isparties agree I'm going to be
the spouse that's going tocontinue to reside in this
marital residence during thedependency of our divorce.
We confirm that in what'scalled a temporary order It'll
also lay the terms out for who'spaying the mortgage, who's
paying the utilities, who'sresponsible for the upkeep of
that residence.
(50:46):
So we ensure that the home isgoing to be protected and
preserved because if later on wewant to sell it, we want to
ensure that it's in a goodcondition and that people are
doing what they're supposed todo in regards to bills and
utilities.
Speaker 2 (50:58):
Great, yes, thank you , and we do get that question a
lot.
It is very difficult to livewith someone you're divorcing,
so I imagine.
So we do, you know we do.
We do deal with that a lot.
Thank you, brie.
We can take a few more.
We're getting quite a few.
(51:20):
I can take this one.
It's what steps do you takewhen a spouse is reluctant to
participate in the process ofdivorce or discovery?
Sorry, now, discovery is aprocess and you know we have
lots of resources on our websiteat HuntLawTexascom if y'all
(51:43):
need it.
The process of discovery is very, very important in a divorce,
especially if you are completely, you know not in the know about
your financial assets andexpenses etc.
And so sometimes you know youwant to go talk to a CDFA, like
Elizabeth, but you might noteven know what you're dealing
(52:05):
with, and that's when you mightneed to take a step back and
your divorce attorney needs todo what's called discovery,
which is a formal way of askingyour spouse for documents, and
that's a question we get a lot.
I don't know what assets wehave, I don't know where to
start, I don't know what hemight be hiding or she might be
(52:26):
hiding.
So we like the discoveryprocess a lot.
I think pretty much everycontested case needs to do it.
It allows for us to get a goodpicture of the assets.
But sometimes, oftentimes, wehave spouses who decide that you
know what, I'm just not goingto give you everything.
(52:48):
Or they take out certain monthsor they do something.
They don't give a whole account, and sometimes they do that on
purpose and sometimes they do itjust out of laziness, right?
So there are certain things wedo as attorneys to make sure
(53:09):
that discovery is complete andwe can see everything.
The first thing we do is we doa very thorough review and we
make sure we list everything andthen sometimes, depending on
the case, we reach out to theother attorney or the other side
and tell them you know, we'remissing quite a few documents
(53:30):
here and your client's notcomplying, so please give that
to us.
And if that's not going to getanywhere we don't think that's
going to get anywhere we sendthem a very formal letter and
before we walk into court andask the judge to order anything,
we actually have to confer withthe other side and try and
resolve any kind of discoveryissues.
(53:51):
So we try and do that bypicking up the phone, sending a
letter and then we give them adeadline and if they're still
not complying, if they're justdeciding you know what I'm not
going to give y'all anythingbecause either they're hiding
something or whatever they justdon't want to be a part of the
process well then we do have totake it to court.
(54:13):
So we file something called amotion to compel and we ask for
attorney's fees and sometimeseven sanctions, which are a
little bit harsher than justasking for attorney's fees, and
we ask the courts.
We show the court how muchwe've tried to work with them,
we show the court what ismissing and why it's important
(54:34):
that we get it, and we ask thecourt to go ahead and give us
the attorney's fees we've had tospend in order to try and track
all these down and we try andget an order.
We also can subpoena thesedocuments ourselves.
So if your spouse gave you orgave us one out of four of the
(54:55):
Wells Fargo accounts they own,for instance, we can go ahead
and subpoena Wells Fargo andtell them to give us everything
possible and that takes sometime to get and we do consider
those expenses at the end and wecan even, you know, ask a court
to award that, if we, if we endup in court, any expenses that
(55:18):
came with us having to subpoenadocuments instead of you know
them, just giving it to us.
We can do that to make sure wehave a good idea of everything.
But discovery is a very, veryimportant process, so that's
something we take prettyseriously here at Hot Law Firm
(55:40):
when we do these divorces.
The last question I think wecan take is and it says, asking
for a friend Can you makemonthly withdrawals on your 401k
after retirement?
Is it normal for the investorof your 401k to tell you how
(56:01):
much you can take out every year?
I have no ideas, elizabeth, doyou know?
Speaker 3 (56:14):
I have no ideas, elizabeth, you know.
So I guess my question on thiswould be is it the person asking
the question or the spouses401k?
So since we're talking aboutdivorce, I'm going to say it's
the spouses and answer it thatway.
So in the quadra that wementioned earlier the qualified
domestic relation order thatwill be spelled out on that
legal form.
So usually with a 401k or apension, they're both treated
(56:41):
the same way.
It will be outlined what thespouse is supposed to receive.
The spouse is supposed toreceive, and once retirement
hits, then they will startreceiving those payments.
And there are ways to ensurethat you get those.
Like, let's say, your spousedies, there's life insurance
(57:01):
policies that you can put inplace to make sure that if they
pass away or they get fired fromtheir job or whatever the case
may be that you're still goingto be getting those payments.
Do you mind putting thequestion back up there?
I was going to go to the secondpart of the question.
Thank you.
Is it normal for the investor ofyour 401k to tell you how much
(57:22):
you can take out every year?
So that would be something afinancial advisor like myself
can tell you If you're at whatwe call required minimum
distribution age, which is 73 or75, depending on the year of
their birth.
There's a certain amount thatyou are required to take out
every year.
Otherwise there can bepenalties if you're under 59 and
(57:45):
a half.
If you're above 59 and a halfbut below that required minimum
distribution age, you take itout and you're taxed at your
income tax rate.
It's counted as income, butyou're not paying that penalty
fee.
So my advice to you would bedefinitely talk to a financial
professional about withdrawalsand how that may affect your tax
(58:08):
in your particular situation.
Speaker 2 (58:10):
Thank you, elizabeth.
Well, we've come to the end.
This was great.
Thank you so much, ladies.
Y'all all had a lot ofinformation, and I actually
learned a lot too, so thank youfor that that we have.
(58:34):
We will be putting this, asAlex said at the beginning, out
as a podcast.
We will have this availableafterwards, so we'll have all of
that on our social media.
So please look for that.
But thank you everybody forjoining us today and have a
great rest of your day.
Good afternoon everybody.
My name is Alex Hunt and I'mthe managing attorney of Hunt
Law Firm.
We're a law firm dedicated tofamily law and our family law
clients.
We serve clients throughout thegreater Houston area.
I'd like to welcome everybodyto today's live chat Building
Stability for Women Property andFinancial Guidance After
Divorce, which is also beingrecorded for our podcast, the
(00:31):
Texas Family Lawyer Podcast.
When this episode is published,it'll be our one year
anniversary since we started thepodcast, and it has been an
incredible experience being ableto have these really deep
conversations on the podcastevery month with attorneys and
financial analysts other expertsin their field about how
(00:52):
regular people, whether theyhave experience in the family
law system or not, can approachfamily law, divorce, child
custody, estate planning issuesin the most effective and
cost-effective way possible.
If you're watching this live onYouTube or Facebook or LinkedIn,
please join our conversation.
Take a minute to look up thepodcast.
(01:12):
Wherever you listen, it'scalled the Texas Family Lawyer
Podcast and if you are watchingon one of those platforms,
please send us in your comments.
We'll be able to ask ourexperts those questions at the
very end of our one-hour seminarToday.
We have assembled a veryspecial panel of experts for our
(01:34):
conversation and I'm reallylooking forward to the
conversation.
And to help moderate ourconversation, I'll hand the
reins to Hunt Law Firm SeniorAttorney Melissa Massou.
Thanks, everybody.
Speaker 2 (01:47):
Thank you, alex.
Good afternoon and welcome tothose of you who are joining us
today.
My name is Melissa Massou and,as Alex mentioned, I am one of
the two senior attorneys here atHunt Law Firm.
I've been at Hunt Law Firm forabout seven years now, and
today's subject matter issomething I've been wanting to
present on for years.
(02:08):
I started as a family lawyer,primarily helping women in
difficult situations involvingphysical abuse, financial abuse
and or emotional abuse.
There are just so many women inthese abusive or just
(02:29):
financially disadvantagedsituations who just don't know
what they can or cannot do in adivorce, what their rights are
or who even to speak to.
So that is the goal for today.
I want to give the audiencemembers some crucial information
that will help you allunderstand your rights, your
options and what you can do in adivorce and what you can't do
in a divorce, and maybe give youjust a little bit more peace of
(02:52):
mind after all of this is doneWith that being said, let me
introduce you to our expertpanelists today.
So thank you, ladies, first ofall, for taking the time to join
us today.
First we have the lovelyElizabeth Love Morrison of Love
Financial Group.
She is a certified divorcefinancial analyst, or CDFA.
(03:15):
We also have the incredibleJennifer Francois of Keller
Williams, our certified divorcereal estate expert, or CDRE.
We have the brilliant ShellyMitchell of Divorce Equity
Solutions, who is a certifieddivorce real estate expert, or
CDRE.
We have the brilliant ShellyMitchell of Divorce Equity
Solutions, who is a certifieddivorce lending professional, or
CDLP.
And last but certainly notleast, we're joined by Brie
(03:35):
Holcomb.
She is Hunt Law Firm's leadattorney of estate planning and
probate.
Welcome, ladies.
So I want to start withElizabeth.
Welcome, ladies.
So I want to start withElizabeth.
Elizabeth, this is a questionthat I get a lot when I
recommend people talk to acertified divorce financial
analyst.
When should a woman seeking adivorce speak to a certified
(04:00):
divorce financial analyst?
What part of the process?
Speaker 3 (04:03):
Hi, thank you for having me today, melissa.
Let me start by explaining whata CDFA is.
A CDFA is a financialprofessional who specializes in
divorce-related financialmatters, so most CDFAs are
financial advisors like me whoare also experts in financial
(04:25):
planning and personal finance.
Many divorcing people are in ahighly anxious state because
they don't know where to start,and a CDFA can tell you what
information you need to get thefinancial piece of your divorce
organized and ready forsettlement or trial.
(04:46):
This can bring comfort toclients who feel buried in
numbers or not sure where tostart, or are wondering if they
will be able to financially liveon their own.
Several people stay in anunhealthy marriage because they
fear that financially they willnot be able to support their
(05:08):
lifestyle.
Meeting with a CDFA even beforeyou file can help ease those
concerns or fears.
Speaker 2 (05:16):
Excellent.
Thank you, elizabeth.
Yes, oftentimes in myconsultations with women who are
nervous about their financialsituation, I tell them to go
ahead and contact a CDFA ASAP,even if they're not ready to
file with us, so they can easetheir minds a little bit.
Get prepared, elizabeth.
I think a common misconceptionabout speaking to a financial
(05:39):
analyst is that you have to havea large number of assets to
speak to one, but that's simplynot true.
Can you tell the audience whatyou would do first?
Say a woman walks in to youroffice and she's contemplating
divorce or already in thedivorce process.
What would you?
Speaker 3 (05:57):
tell them?
Yeah.
So that's another greatquestion, melissa.
I want to start by addressingthe comment on maybe not having
enough assets.
So there's a difference betweenCDFA work and investing assets
in the market, and most CDFAsdon't have any sort of minimum
(06:18):
for assets.
We're here to help you throughthat divorce process.
Help you through that divorceprocess.
So some things that I reallymake sure to address.
First one is a budget, somaking sure that my client has
(06:40):
an idea of what their budget isbefore they get divorced and
after, and so there's usually alittle bit of a shift because
now it's just you and maybechildren, but knowing what those
big expenses are is a goodplace to start.
Sometimes I say the word budgetand it can be overwhelming, but
most CDFAs will have a templatefor you to be able to use and
have that, and knowing what sortof income you're going to need
(07:02):
to maintain that same lifestyleis important.
Another key thing that wediscuss is knowing your assets.
So if there's an asset that youdon't understand, or maybe
there's an asset that you havequestions on, make a point to
try to understand that.
If you haven't filed yet, Iwould start making a list of
(07:26):
what you know, and even if youhave filed, but maybe you're in
the early stages and you haven'tmet with a team yet, it's
important to know what yourassets are and if there's any
debts that are linked to thoseassets.
And then the third thing issetting goals.
So sometimes that can seem kindof overwhelming to think about
(07:46):
what a financial goal may beafter or post divorce.
That that will help you asyou're moving through this
process, to know what you'reworking towards is building your
team, whether that's yourattorney or maybe a friend, a
counselor, a CDFA.
(08:06):
Have a team around you that'shelping support those goals and
needs that you have.
Speaker 2 (08:12):
Thank you.
Yes, budgeting is a very scaryword for a lot of our clients
and you know.
Budgeting with a CDFA orbudgeting period before even
walking into a divorceattorney's office or filing for
divorce is so important becausewe will need that information
(08:33):
and we'll need to know, well,are we going to try and go for a
spousal support or temporarysupport of some kind right away
because our client needs it, orare we okay, moving forward and
it'll help establish the goalsfor your divorce sooner rather
than later?
So budgeting is just really,really important.
(08:56):
So, elizabeth, what are somethings you, as a CDF, face as
challenges for women in thedivorce process?
Speaker 3 (09:02):
Yep, that's another good question.
I think there's a couple ofthings that really come to mind.
The first thing is a lack ofknowledge or maybe just being
really unsure of the questionsthat they need to ask.
It's common for women to haveto learn a whole new set of
financial skills after divorce.
(09:24):
Maybe they weren't in charge ofthe finances or they just
didn't pay as much attention tosome of the details.
I come across this a lot, withwomen feeling like they should
already know the answer or beembarrassed to ask.
My goal is to help empowerwomen to understand their
current situation better and theskills that they need in a
(09:49):
nurturing way where they feelempowered.
Another one is maybe lack ofresources.
A woman may walk away with youknow, quote half of the assets,
but her earning power might bedifferent because she stayed at
home with the kids or has alwayshad a lower paid employment.
(10:09):
So sometimes that means alifestyle change is needed, and
sometimes that just means somecareful planning.
So my job as a CDFA is to helpwomen navigate this and make
choices that fit the lifestylethat she's wanting and
accustomed to.
A third challenge that I seesometimes is a settlement that
(10:32):
doesn't fit.
So if the settlement wasn'tcarefully crafted.
A woman may walk away withassets that she can't afford to
maintain, like a house, orassets that she can't access
like a 401k or a pension, butsometimes that may set her up
for failure in the future.
(10:52):
But I hope to prevent that kindof thing from happening.
And the last thing that I seethat's somewhat common is
becoming fixated on oneparticular asset.
I see that a lot with themarital home and women in
particular becoming afraid thatthey will lose their home or be
unable to afford it afterdivorce.
Speaker 2 (11:13):
Yes.
So we, as the divorce attorneysyou know, have to deal with,
you know, all of these assets,and the biggest asset in most
divorces is the marital home.
Like steps do they need to taketo figure out their options and
(11:45):
avoid making emotional orfinancial missteps?
Speaker 4 (11:50):
So, as a certified divorce lending professional, I
specialize in guiding divorcinghomeowners women through divorce
, property division and mortgagesolutions.
And one of the biggest mistakesI see is people fighting to
keep the marital home withoutfully understanding that they
can afford to keep it and evenqualifying for the mortgage on
(12:15):
their own.
And unfortunately, many womencome to me after the divorce is
finalized and I have to deliverbad news.
You know that they can'tqualify to keep the home or
maybe they're going to do anequity buyout to buy out their
spouse and they now can'tqualify.
So this is why I offer a freedivorce mortgage planning
(12:38):
consultation where I analyze thehome with what I call a real
property report, and this reporthelps divorcing homeowners
determine if they can afford tokeep the home, buy out their
spouse or if maybe selling andpurchasing a new home is a
better option.
And I review income, assets,debts, any maybe child support
(13:01):
they're going to be receiving inthe future once the divorce is
final and any spousal supportyou know we don't see a whole
lot of spousal support in Texas,but sometimes maybe maintenance
support Create a realisticfinancial plan.
And for women that are unsure ifthey can keep the home, the key
is really planning early,getting with me before they're
(13:23):
heading to mediation, before thedivorce is final.
First, they want to reallyunderstand the financial picture
, gather financial documents,including mortgage statements
and tax returns, credit reports,things like that.
Secondly, determine the home'sequity and whether an equity
buyout is going to work orrefinancing is even an option.
(13:45):
And thirdly, work withprofessionals you know whether
it's a CDLP like me or a CDFA toensure keeping the home even
fits in the long-term financialgoals.
So most importantly is don'tlet emotions drive the decision.
So while you know the home mayhold sentimental value, you need
to consider whether it truly isaffordable post-divorce.
(14:07):
And starting the divorcemortgage planning process early
ensures they're going to makeinformed decisions before
finding the final divorce decree.
And so you know just reallyneeding guidance and that's what
I'm here for and helping put asolid plan in place before the
divorce is final.
Thank you, shelly.
Speaker 2 (14:27):
And Shelly, as a CDLP , have you had people come to
you thinking that theyabsolutely cannot afford to keep
the home?
But they came to talk to you,just to talk to you, and they
realized they can in fact keepthe home if they wanted to.
Speaker 4 (14:41):
Absolutely All the time actually.
They wanted to Absolutely Allthe time actually.
So I've had many clients cometo me thinking they can't afford
to keep the home, only torealize that with the right
strategy they actually can keepthe home.
So a big part of my job as aCDLP is helping homeowners see
the full financial picture, notjust what's in front of them at
(15:02):
that time.
And so many assume, you know,they can't qualify for a
mortgage on their own.
But once we factor in incomesources, you know whether it
maybe be like child support,maybe maintenance support or
even creative financingsolutions.
The numbers can really tell adifferent story and that's
(15:23):
another reason getting withsomeone you know a CDLP or CDFA
early in the game is reallyimportant.
So, for example, I had arecently I worked with a woman
who was ready to sell becauseshe assumed she wouldn't qualify
for a mortgage after herdivorce.
But after reviewing her incomeand her assets and just
(15:45):
structuring all of herdocumentation of her divorce
settlement, we found a way touse her support payments as
qualifying income and with arefinance and some smart debt
restructuring she was ableactually to keep her home
without overextending herself.
So you know, that's why it's soimportant to consult with a
CDLP before finalizing thedivorce and we can structure the
(16:09):
settlement in a way thatimproves mortgage eligibility
and financial stability.
Sometimes it's not about whetheryou can afford to keep the home
, it's about having the rightfinancial strategy in place to
make it happen.
So for anyone on this podcastwith us today, if you're unsure,
you know let's have a talk.
You know it's free to have thatfree consultation, and a
(16:30):
divorce mortgage planningconsultation can give you a lot
of clarity and help make theright decision for your future.
Thank you.
Speaker 2 (16:39):
And I believe Elizabeth mentioned this and
then you know seeing theconnection having a team right,
because if you talk to Elizabethearly in the process, when you
talk to Shelly now, you have allyour resources and budget run
and now you're talking to Shellyto get an idea of what you know
(17:01):
your options are, and yourdivorce attorney can also step
into that conversation andfigure out the legal strategy of
how we're going to get thoseassets.
So, working as a team which wedo do at Hunt Law Firm, these
are all women that we work with.
You know to make sure that ourclients are taken care of from
(17:23):
every single perspectivefinancially.
So say, someone comes to you,shelly, and has done all that
work and you realize thatrefinancing or a buyout is an
option for this client.
How long does this processusually take?
Speaker 4 (17:41):
So the process is going to.
You know it depends Are theygoing to do a buyout or are they
going to purchase.
A buyout typically is going totake about 30 to 45 days,
depending on if we've startedthe process early, before the
divorce was final.
So I say 30 to 45 days.
There's a pre-qualificationprocess, there's an application
(18:02):
process.
You know an appraisal needs tobe ordered.
We've got underwriting, gotyour final approval, you've got
closing, you closing some legalsteps and so forth.
But you could be looking atsome potential delays can come
from waiting for finalizeddivorce decree, support payment
(18:23):
documentation.
When you're waiting for, maybe,child support to kick in.
There is a three-month waitingperiod on something like that.
Maybe you know you could havesome title issues, but for the
most part 30 to 45 days for abuyout and that's why starting
early is always the key part ofit, before the divorce is final.
Speaker 2 (18:43):
It helps to prevent any type of stress and then it's
going to ensure smoothtransaction of stress and then
it's going to ensure a smoothtransaction Right, and it also
helps if you are sitting in amediation, like you're divorce
determining, knowing you knowwhat that timeline is.
So we don't go ahead and agree.
You know, sometimes the otherside will push for a 30 day
(19:05):
buyout situation and if I'mtalking to you, shelly, I know
well that's not possible, sowe're not going to agree to that
, and it helps a lot.
Thank you so much, shelly.
So, jennifer, I kind of want togo to you next.
So many people in our audienceand I get this question a lot
(19:26):
when I talk about, you know,talking to a CDRE when there is
a marital home evolved, what isa CDRE and why are CDREs so
valuable during a divorce?
Speaker 5 (19:38):
Thanks for having me.
By the way, I'm happy to behere.
I've been in real estate for 22years and I've always sold
different types of housing.
So over the years I run intomany families, women who are
going through the most difficulttime in their lives and it
became apparent to me that if Iwas going to provide the highest
level of service, I needed toincrease my education, which it
(20:00):
was then that I decided topursue the designation in
divorce real estate.
And what makes us different is aCDRE is trained extensively on
selling real property and familylaw cases and to do so as a
neutral, unbiased third-partyexpert.
We're also required to adhereto a stringent code of ethics to
ensure a smooth and successfultransaction, supporting all the
(20:24):
parties equally and ensuringthat the orders of the court are
followed.
We also act as a witness incourt and we're trained to
testify when needed.
So frequently divorce realestate sales they're highly
emotional and ensuring thateverybody feels fully supported
through the time and, with aneutral, unbiased third party,
(20:47):
it ensures that we have a smoothand successful transaction.
Speaker 2 (20:51):
Great and you mentioned being involved, very
involved, in the process ofdivorce, being a witness and all
of that.
I know from talking and workingwith Elizabeth and Shelly.
Y'all also can be a part of themediation process and a part of
all of that as well.
So it's like I said, it's justso important, if you're talking
(21:13):
about financial stability anddivorce and what you can and
can't do, to have that teamaround you so that every step of
the way you have you know thisgreat team that can even sit on
in mediations with your attorney, so that you're getting the
absolute best you know possibledeal and you're you're sitting
(21:37):
there knowledgeable and not kindof in the dark.
So, jennifer, if someone comesto you wanting to buy a new home
without their spouse on thepaperwork so we're going through
a divorce, or they haven'tquite even filed for divorce
what do you tell them?
Speaker 5 (21:56):
Yeah, so this happens fairly regularly.
Everybody's trying to makeplans for their future and
there's just a process involved,right?
So first and foremost, I wantto understand at what phase they
are in the divorce.
Have they even filed?
Did they purchase the home?
If we're selling a home andthey want to sell before we file
for divorce, did they purchasethe home jointly?
(22:19):
A lot of times I have to educateon community property and what
that means.
As Texas is a communityproperty state, it means that
all assets obtained during themarriage would be subject to
joint ownership.
So if you purchase a home priorto finalizing your divorce,
that could definitely cause somechallenges.
So I work to gain knowledge.
(22:40):
I like to engage the attorneyand understand if there are
court orders regarding themarital property, regarding
future housing requirements, ifthere's children involved and
where those homes may need to be.
So usually, the best next stepreally is to meet with a CDFA
and a CDLP to evaluate what theavailable options are and ensure
(23:01):
that we're following the rightprocess, because we don't want
to put the cart before the horseand get ourselves into a sticky
situation where there's anasset obtained during a marriage
that wasn't obtained in thecorrect manner, and protect the
client from that.
Speaker 2 (23:16):
Right and we always Brie will attest to this as well
we always advise our clientsnot to buy that home or try and
buy a home during the divorce,unless it's absolutely necessary
, unless the other side is 100%on board, unless we have an
agreement on paper that how it'sgoing to be divided, et cetera,
(23:40):
because it does create so manyissues.
Speaker 5 (23:45):
It can be done, but not well and not easily.
So it's just it's smarter towait for sure.
Speaker 2 (23:52):
Now, as a CDRE, can you give the audience some tips
as to what someone who needs tosell a home should be doing to
maximize that home's?
Speaker 5 (24:00):
value Absolutely.
So, most importantly, the bestfirst step is really to conduct
a home visit so that I can, oranother CDRE can, evaluate the
condition of the property andmake recommendations, because
what we don't want is you to goand spend a bunch of money or
time on something that will notprovide a returnable value in
(24:22):
the marketplace If the client isnot ready for a home visit.
Best first steps always includeperforming general maintenance
on the property.
Things that I see that areoften not done are performing
regular AC and roof maintenance.
Those can be very expensiverepairs that could become a
(24:45):
problem during a sale.
So making sure thosemaintenance items are done and
that we know of any existingsituations ahead of time and
then addressing them, repairingany known defects or things that
the family knows don't functionbefore going on the market is
absolutely the best step as well.
(25:05):
So then you have things likedecluttering, depersonalizing as
well.
So then you have things likedecluttering, depersonalizing,
doing a really good, deep, clean, power washing driveways and
back patios.
Anything that you can do toimprove the physical condition
of the property is ideal,because that's going to allow us
to maximize what we can getwhen we sell the property.
So, as I mentioned, I don'trecommend investing in any
(25:26):
upgrades or updates before aproperty visit, as I want to
make sure that my clients arespending their money wisely.
That will improve the value andthe resale potential of the
property.
And then if there are, if thereis work or repairs that need to
be made or items that we coulddo that would improve the value
and there's not funds availablefor that, then we do also have
(25:50):
some resources available or wecould get creative when needed,
so those are always an option.
Speaker 2 (25:55):
Great, thank you.
So in today's market which hasbeen a little bit crazy what
would you say to someone who'slooking for a realistic timeline
as to selling or buying a home?
Speaker 5 (26:08):
Yeah, so, as with every real estate market, it
ebbs and flows, right.
We've seen a lot of changessince COVID and the market's
kind of had a lot of shifting,but it typically always has a
cycle right.
So, and we're in coming intothe spring cycle, so right now
is a great.
If people are consideringselling.
This is when we start to pickup for the year and we're really
(26:30):
seeing that happen.
So homes that are in excellentcondition are actually selling
really well, and so it'simportant that we prepare for
either scenario for buying orselling, but understanding, you
know, what's happening in thatneighborhood, in that home type.
Every neighborhood is verydifferent.
So it's important that we do areally deep dive and analysis on
(26:52):
what's happening in thatspecific neighborhood, in that
market, because every submarketwithin our, within our area,
sells differently.
So we and we do this byutilizing our resources with our
partners, with our CDFA, ourCDLP and your attorney and the
four of us, as we mentioned,kind of act as a hub of a wheel.
Any missing part of the hubwould not allow the wheel to
(27:14):
function at its highest, at itshighest output.
So having your team andensuring that we're all together
and communicating correctlywill make sure we know what the
ideal timeline is, but once weget a clear picture and we're
ready to list the home or topurchase a home, a good
expectation is usually anywherefrom 45 to 90 days, depending on
where we are in the approvalprocess.
(27:36):
Have we established our budgetsalready?
Do we know what our assets looklike, you know?
Do we have our divorce decreefinalized and know what our,
what our budget's going to be?
Once we're really solidly ready, 45 to 90 days is a good
timeline.
Speaker 2 (27:49):
Great, and so say the parties.
Go through, shelly and Jenniferand both of y'all, and maybe
they've spoken to me as theirdivorce attorney and now we're
ready to negotiate their actualdivorce terms in a mediation.
Elizabeth, I'm going to comeback to you.
(28:09):
What are some common mistakesyou see your clients making when
finalizing those terms of thedivorce?
Speaker 3 (28:16):
So I think the most common thing that I see is not
asking questions.
I touched on this before, butas you're going through the
divorce process, you want tomake sure that you're
understanding exactly what youneed to live off of and what the
(28:38):
settlement is going to be.
A lot of times, like Imentioned earlier, women may
feel embarrassed or like theyshould already know the
information, but knowledge is soimportant as you are dividing
up your family assets.
So ask questions and if you'rein a situation where you maybe
(28:59):
have a team and you don't feelcomfortable asking questions,
then find somebody that you dofeel comfortable asking
questions.
I try to make a point of doingthat with my clients and having
check-ins and making sure thatthey're understanding what we're
talking about.
The second thing is and I knowthis has been touched on today
(29:19):
too is letting emotions cloudyour judgment.
Divorce is a highly emotionaltime, so it's natural to have
those ebbs and flows of emotions, but making sure that you have
a team that's supporting you tohelp you see logically and long
(29:40):
term, which is the next thingthat I see a lot of is failure
to think long term.
It's very tempting to just tryto get to the settlement and
have it over with, but you wantto make sure, especially as
you're putting together yourfinancial future, that you're
(30:00):
looking at well, just dodivision of assets, for example,
and making sure that those aregoing to be able to last you
past the settlement date, thatyou're able to have the income
that you need to support thoseexpenses that you're going to
have.
And, lastly, not getting help,not reaching out.
(30:21):
I've worked with a lot of womenand after the divorce they just
kind of spin out emotionallyand a divorce is a massive
change and it can be very hardto navigate alone.
So just realize that and knowthat there are people here, like
the people in this podcast,that are here to help you
(30:43):
throughout that process.
Speaker 2 (30:45):
Thank you, Elizabeth.
I'm going to go to you, Shelly,and kind of ask you the same
question what are some of themost costly mistakes you've seen
clients make in their finalsettlement?
Speaker 4 (30:56):
Sure.
So one of the biggest mistakesI see in divorce divorcing
homeowners is keeping the homewithout confirming affordability
.
So I see so many fight to keepa home without confirming that
they actually qualify for amortgage, leading to financial
strain or even foreclosure.
(31:17):
Or they fight to keep the homeand within six months to a year
later they're selling their homebecause they realize they
cannot qualify for equity buyoutor it's too much house and they
should actually be selling thehome and not have retained the
home.
The other thing that I see isnot refinancing to remove an
(31:37):
ex-spouse and that ex-spousethat has moved on.
They don't realize that it isstill affecting their credit.
And so the spouse that hasretained the home, if they for
some reason do not make timelypayments on the home, it
actually affects the spouse thatif their name is still on the
mortgage, it will affect theircredit, and so there's some
(32:01):
misconception about that, and sothat is something as well.
And then relying on childsupport, and so lenders require
proof of consistency of paymentsfor three to six months before
even being able to use the andcount it as as income for
qualification purposes.
And so you know, divorcingparents homeowners will come out
(32:25):
of a divorce and immediatelywant to qualify to either one
keep the home for an equitybuyout or want to purchase a
home immediately, and they arerelying on child support
payments and they have notreceived it for three to six
months yet and so they cannotqualify for a mortgage loan.
And then overlooking hidden costof home ownership.
(32:46):
You know it's not just about aprincipal and home ownership.
You know it's not just about aprincipal and interest payment.
You know there's property taxesand homeowners insurance, which
we all know have increasedquite a bit over the years, and
maintenance costs and homeownersor HOA dues.
And that just needs to be takeninto consideration when you
(33:06):
know someone wants to keep ahome.
So just fully evaluate the costbefore deciding to keep the
home and then splitting upequity and considering taxes.
People overlook capital gainstaxes and so of course I'm not a
tax accountant, I don'tpractice law, but I always say
get with a CDFA or a taxaccountant, speak to your
(33:30):
attorney, because you know whenyou're splitting up multiple
homes or maybe investmentproperty, there could be capital
gains and just proper planning,expert guidance and just avoid
these costly mistakes.
Speaker 2 (33:45):
Thank you, shelly, and I also tell my clients I'm
not a tax expert.
You need to talk to somebodywho is, and the tax impact of
certain assets is somethingElizabeth can help with.
But certain assets, like a homeor a IRA or whatever, have
different tax consequences thatpeople don't think about.
(34:09):
So that's something that we tryand think about as your divorce
attorney when we're sitting inmediation, going okay, well, do
you want this or this?
It's going to give you adifferent value.
Really, I mean, on paper itlooks like the same value, but
the tax impact might actuallychange that value, right?
So yes, so thank you, shelly.
Those were all excellent tips.
(34:31):
So, jennifer, I'll go to younext.
Any tips from a CDRE as to whatthe audience should be prepared
with going into a finalmediation from your perspective.
Speaker 5 (34:43):
Yeah.
So a few items that come tomind is the biggest piece is
having a solid expectations onthe value of the marital
property.
Often getting a formalappraisal is helpful.
It's not required, but it'shelpful.
I can also provide a marketanalysis reports, if they're
accepted as means to the partiesto establish value, so that way
(35:03):
we know what that asset couldpotentially sell for.
That way we know what thatasset could potentially sell for
Then be prepared to set a listprice as part of the mediation,
because those terms really doneed to be in writing to avoid
potential future conflict.
Then and we want that writteninto the decree a firm decision
(35:24):
on how the proceeds are to besplit and if attorney's fees
will be held from those proceeds, because it's important that we
have a detailed decision as tohow proceeds are going to be
applied If the property hasn'tbeen sold at the time.
You want to write in thepreferred CDRE's name into the
decree hopefully me and we wantto make sure that we make
(35:47):
decisions on how personalproperty are to be split and how
the outspouse will collect them, because those details are
important for logistics,especially if there's conflict.
Is there a required schoolsystem or county that the
parties are required to live infor the children or distance
away.
Those are things that we needto know and if they're going to
be written into that decree toensure that we make those
(36:10):
decisions so that I can havethose in writing and be able to
hold up the court orders, then,if we haven't sold the property
at the time of the mediation,we'll want to know who's going
to maintain the property Ifneither property is living there
.
Who's going to maintainutilities?
Who's going to do any necessaryrepairs while the property If
neither property is living there, who's going to maintain
(36:30):
utilities?
Who's going to do any necessaryrepairs while the property's on
the market, if there is aproperty to sell?
So there's a lot of detailsthat need to be worked out that
get written into that decree toensure that we don't miss
anything and that we're able toget the property sold and make
the most money for it.
Speaker 2 (36:46):
Now let's pretend the audience has a final decree of
divorce.
We settled in mediation and wehave a divorce decree in hand
that's actually signed by ajudge.
It has the assets divided andthe parties are now officially
divorced.
So, Elizabeth, what do you tellyour clients to look out for as
far as the financial issuesafter a divorce?
Speaker 3 (37:08):
Yeah, so that's something really good to keep in
mind.
A lot of times you know you getto the end of the settlement
and you think, yay, I'm done.
But on the financial sidethere's still quite a few things
to make sure are done andimplemented before you can kind
of rest easy.
So one of those is if you aregetting your ex-spouse's 401k or
(37:34):
maybe a pension, you'll havewhat's called a qualified
domestic relation order andyou'll want to make sure that
that gets processed.
That's something that does nothappen automatically at
settlement.
If you are getting an IRA froma spouse, you're going to want
to make sure that you open up anIRA in your name and get that
transferred.
(37:54):
Again, that's something that Ican help you with as a CDFA, but
it's going to have to be done.
It doesn't just automaticallyhappen.
A couple of other examples wouldbe let's say you're getting a
car and the title was in yourex-spouse's name.
You're going to want to changethat title.
A checking account, I mean.
I always recommend doing thatbefore a settlement date.
(38:16):
But if you don't have one,that's in your need to make sure
that are handled properly afterthe divorce so that you can
transfer those assets into yourname the way that the settlement
states that it should be.
Oh and something else to keepin mind.
(38:40):
It can seem like a lot,something that I recommend is
just having.
I have a list for for all myclients of things to go down,
and so it can seem a little bitmore manageable that way.
Okay, I checked this one off,now this one, and so you're
keeping a list of everythingthat needs to get done.
Then, once you get to thebottom, then you can relax and
(39:02):
celebrate.
Speaker 2 (39:03):
Thank you, elizabeth.
So and you brought up a greatpoint about transferring assets
and making sure everything isunder your name Sometimes our
clients come out of a divorceand they have that divorce
decree in hand and they've neverhad, you know, especially if
they've been in a financiallyabusive situation where they had
(39:23):
no control of their money andtheir assets.
They've never had assets intheir name.
They've maybe never had achecking account in their name
or a life insurance policy intheir name or whatever.
This is where I think estateplanning I think everyone will
agree estate planning is very,very important at the end of
(39:44):
your divorce process.
So I'll bring Brie Holcomb into this conversation Now.
Brie, you're the lead attorneyof Hunt Law Firm's estate
planning and probate section.
How important is it for someoneto do their estate planning
after a divorce and why?
Speaker 6 (40:02):
It's absolutely imperative.
So when you go through adivorce, it's a life-changing
and life-altering event.
Many people compare losing aspouse even though they're still
alive, almost to death.
So just because a divorce hasoccurred, we want to make sure
(40:26):
that our women are takingcrucial steps to ensure that
their new assets that they haveare going to be protected.
It's important to know kind ofat the outset, though if you had
an estate plan that named yourformer spouse as a beneficiary,
as an executor, a trustee, anagent, under Texas law that
individual that husband is goingto automatically be precluded
from serving in those capacities.
There's a reason that divorcehappened and that individual is
not going to be allowed to servein those positions anymore.
(40:49):
The other things that I wouldencourage women to do I've got
kind of four takeaways.
First is to do an inventory ofyour estate.
You know, coming out of adivorce, you may have done an
inventory and appraisement,which is basically a fancy
document that lists all of yourassets and liabilities.
That's kind of what we use asattorneys to help divide our
(41:09):
estate in the midst of a divorce.
In the event that you didn't dothat, maybe you guys had a
peaceful and amicable divorceresolution.
What you can do is just kind ofstart to gather you can partner
with a CDFA what assets do Ihave in my pot and just really
inventory.
These are all of the items thatI have that I need to ensure
(41:30):
are you know now in my estateand are going to the people that
I want them to go to when Ipass away.
And that's going to help youidentify your assets so that
you're able to then.
Step two update yourbeneficiaries.
A lot of accounts thatindividuals have could be
transferable or payable on death.
So after a divorce, youcertainly want to make sure that
(41:51):
your beneficiaries are up todate and that the individuals
that you want to inherit areable to inherit, and so if you
work with a financial advisor,that person can certainly assist
you in updating thosebeneficiaries.
You may be able to do them onyour own through the certain
financial institutions that youhave, and examples of those
(42:11):
payable on death assets could belife insurance policies,
retirement accounts, any otherassets that are transferable or
payable on death.
Step three, I would say, is tocreate your will.
You want to revise that will toensure that your husband is now
no longer a part of it, eventhough again automatically
revoked after your divorce isfinalized.
(42:32):
But you've got to consider, youknow, who are my new
beneficiaries going to be?
If you don't have any children,who is going to inherit my
estate?
If you do have children, who'sthe guardian of that child going
to be if something happened toyou and your former spouse?
Do I need a trust for theseindividuals that are going to be
?
If something happened to youand your former spouse, do I
need a trust for theseindividuals that are going to
(42:52):
inherit from me and who do Iwant to be in charge if and when
that time comes and I pass awayand somebody is going to have
to, you know, step in andfacilitate the distribution of
your estate?
And, lastly, I would say thefourth thing that women want to
make sure they do is updatingtheir plan for incapacitation.
You know, oftentimes we're veryfocused on well, what happens
when I pass away, but therecould be many instances where
(43:14):
you become incapacitated andcannot make decisions for
yourself.
If you are married, your spousemay be able to step in and take
ownership and take action, butif you are divorced, we need to
appoint individuals to ensurethat you know a plan is going to
be in place if somethinghappened to you and you're alive
, but you can't make decisionsfor yourself, so it's very
(43:35):
important for women to considerall of those things.
The other tidbit that I'llleave you with is you know,
oftentimes women get remarried,and that's a wonderful and a
beautiful thing, but when we'replanning for our next estate and
you've got blended families, wedefinitely want to take into
consideration well, whatseparate property do I have?
What community property isgoing to be created?
Should I get a premaritalagreement or a postmarital
(43:58):
agreement?
Those are all things that we,as estate planning attorneys and
family law attorneys, cancertainly talk through to ensure
that you are protected afterdivorce.
Speaker 2 (44:08):
Thank you, brie.
So we have a couple ofquestions, so we're going to
switch to the questions part ofthis, and so I will start with
Elizabeth.
This question is for you howcan I create a post-divorce
budget that reflects my newfinancial reality?
What are some tips you have forthat?
Speaker 3 (44:29):
That's a good question.
So I would start with expensesthat you know you're going to
have cell phone, eating you'vegot to eat, right and I would
take a look at kind of what yourbudget is before the divorce so
married I don't know if youhave kids or not and kind of
estimate what would that be onyour own and these are estimates
(44:52):
, right, because you don't knowexactly what it's going to be
until you're living on your ownA CDFA, like myself, can give
you some good guidelines andparameters, because we've seen
people do it and we have prettygood estimates of, depending on
where you are in life, kind ofwhat those numbers would be.
Another thing to consider is areyou working or not?
(45:13):
If you are, what is that incomegoing to be?
Are you going to need childcare?
Are you going to have to goback to work after this?
Will you need child care?
Things like that.
But that's where I would startis with things that you know and
then work your way from thereand, like I said, a CDFA is
(45:34):
going to have the resources tobe able to help you with sheets
and templates and estimates thatwe've used with other clients.
Speaker 2 (45:41):
Great, thank you.
Our next question and this cango to Jennifer are there
strategies to make the homeselling process easier if I have
a reluctant spouse?
And this is somethingJennifer's trained in as a CDRE.
Jennifer, take it away.
Speaker 5 (46:02):
Yes.
So that's a great question andthat's definitely the most
difficult part is when we're notin agreement on how to manage
the marital property.
First and foremost, it's superimportant to work through with
your attorney to hopefully cometo terms during mediation and
(46:22):
gain agreement and get thoseagreements in writing Ways to
make it easier.
So I offer a consultation toall of my clients, whether it's
going through a divorce or justa traditional sale.
But I like to meet with eachparty separately.
That way they have the abilityto speak freely and I can help
(46:48):
them through the decision andunderstand and really connect
with them independently.
As I mentioned, maintainingneutrality is absolutely the
most important piece, becauseeverybody wants to feel heard
and understood.
And when I'm able to hear allsides of what's going on and
then really just look at thefacts and the details and then
(47:10):
have a conversation with theattorney to know where we are,
what do we need to, what do weneed to do, what steps do we
need to take and ensure thatwe're all on the same page, then
I will usually inspect theproperty as well with the
in-spouse the person that'sliving there and then take some
photos of the property, becausesometimes there is the
(47:31):
out-spouse that's not seen theproperty in a while and they may
need to understand what thecondition is, what the condition
of the market is, and justreally take time to educate, and
usually, once you provide ahigh level of education and
support, we're usually able tocome to agreeable terms.
It might take a fewconversations, but we usually
(47:52):
get there.
Speaker 2 (47:53):
Great, Thank you.
The next question is how can Iprotect my credit during and
after a divorce?
I think this could go toElizabeth.
Speaker 3 (48:11):
I think this could go to Elizabeth.
I got one.
Go for it.
So the first thing that I wouldsay is I don't know what stage
this person is in in the divorce, but even before you file, I
would recommend having aseparate credit card and opening
up your own checking andsavings accounts and having
things in your name.
Now, that is not going tonecessarily help if you have a
(48:33):
joint credit card, but I know onthe legal side, I think once
you file, those can be frozenand so hopefully they're not
charging up the credit cardafter the filing has happened.
But my biggest recommendationis to make sure that you're
(48:53):
starting to transition thingsinto your own name and you're
building your own credit.
Speaker 2 (48:59):
Thank you.
Thank you, elizabeth.
Okay, the next and possiblylast one we have is and I'll
actually go to Brie for this one.
I think it's a good one forBrie Do I have to live with my
spouse while the divorce ispending?
Can I move out or force themout?
(49:21):
Brie, you can take it.
Speaker 6 (49:23):
That's a good one.
So, first and foremost, it'sreally important to know that if
you leave the marital residence, that does not mean that you
are then precluded from takingthat asset or you are giving up
a portion of that asset.
We oftentimes have clientsleave the marital residence
because they don't feel safe,and we're not going to penalize
(49:43):
anybody for that.
It's also important to knowthat when we're going through
divorce, spouses oftentimescan't be in the same residence
with each other because they'realways bickering or fighting and
it's just not good for mentalhealth.
So do you have to live withyour spouse during the divorce?
The answer is no, and there'sreally not going to be some
major consequence of I moved outof the house.
(50:05):
Now I can't say I want it on afinal order and I'd like to be
awarded that.
Can I move out or force themout?
Yes, you can certainly move out.
The forethought is a little bitdifferent.
In you know family law, weoftentimes don't have major
kickout orders where a spouse iscompletely removed from the
residence, unless there's beensome sort of major family
(50:26):
violence.
But what oftentimes happen isparties agree I'm going to be
the spouse that's going tocontinue to reside in this
marital residence during thedependency of our divorce.
We confirm that in what'scalled a temporary order It'll
also lay the terms out for who'spaying the mortgage, who's
paying the utilities, who'sresponsible for the upkeep of
that residence.
(50:46):
So we ensure that the home isgoing to be protected and
preserved because if later on wewant to sell it, we want to
ensure that it's in a goodcondition and that people are
doing what they're supposed todo in regards to bills and
utilities.
Speaker 2 (50:58):
Great, yes, thank you , and we do get that question a
lot.
It is very difficult to livewith someone you're divorcing,
so I imagine.
So we do, you know we do.
We do deal with that a lot.
Thank you, brie.
We can take a few more.
We're getting quite a few.
(51:20):
I can take this one.
It's what steps do you takewhen a spouse is reluctant to
participate in the process ofdivorce or discovery?
Sorry, now, discovery is aprocess and you know we have
lots of resources on our websiteat HuntLawTexascom if y'all
(51:43):
need it.
The process of discovery is very, very important in a divorce,
especially if you are completely, you know not in the know about
your financial assets andexpenses etc.
And so sometimes you know youwant to go talk to a CDFA, like
Elizabeth, but you might noteven know what you're dealing
(52:05):
with, and that's when you mightneed to take a step back and
your divorce attorney needs todo what's called discovery,
which is a formal way of askingyour spouse for documents, and
that's a question we get a lot.
I don't know what assets wehave, I don't know where to
start, I don't know what hemight be hiding or she might be
(52:26):
hiding.
So we like the discoveryprocess a lot.
I think pretty much everycontested case needs to do it.
It allows for us to get a goodpicture of the assets.
But sometimes, oftentimes, wehave spouses who decide that you
know what, I'm just not goingto give you everything.
(52:48):
Or they take out certain monthsor they do something.
They don't give a whole account, and sometimes they do that on
purpose and sometimes they do itjust out of laziness, right?
So there are certain things wedo as attorneys to make sure
(53:09):
that discovery is complete andwe can see everything.
The first thing we do is we doa very thorough review and we
make sure we list everything andthen sometimes, depending on
the case, we reach out to theother attorney or the other side
and tell them you know, we'remissing quite a few documents
(53:30):
here and your client's notcomplying, so please give that
to us.
And if that's not going to getanywhere we don't think that's
going to get anywhere we sendthem a very formal letter and
before we walk into court andask the judge to order anything,
we actually have to confer withthe other side and try and
resolve any kind of discoveryissues.
(53:51):
So we try and do that bypicking up the phone, sending a
letter and then we give them adeadline and if they're still
not complying, if they're justdeciding you know what I'm not
going to give y'all anythingbecause either they're hiding
something or whatever they justdon't want to be a part of the
process well then we do have totake it to court.
(54:13):
So we file something called amotion to compel and we ask for
attorney's fees and sometimeseven sanctions, which are a
little bit harsher than justasking for attorney's fees, and
we ask the courts.
We show the court how muchwe've tried to work with them,
we show the court what ismissing and why it's important
(54:34):
that we get it, and we ask thecourt to go ahead and give us
the attorney's fees we've had tospend in order to try and track
all these down and we try andget an order.
We also can subpoena thesedocuments ourselves.
So if your spouse gave you orgave us one out of four of the
(54:55):
Wells Fargo accounts they own,for instance, we can go ahead
and subpoena Wells Fargo andtell them to give us everything
possible and that takes sometime to get and we do consider
those expenses at the end and wecan even, you know, ask a court
to award that, if we, if we endup in court, any expenses that
(55:18):
came with us having to subpoenadocuments instead of you know
them, just giving it to us.
We can do that to make sure wehave a good idea of everything.
But discovery is a very, veryimportant process, so that's
something we take prettyseriously here at Hot Law Firm
(55:40):
when we do these divorces.
The last question I think wecan take is and it says, asking
for a friend Can you makemonthly withdrawals on your 401k
after retirement?
Is it normal for the investorof your 401k to tell you how
(56:01):
much you can take out every year?
I have no ideas, elizabeth, doyou know?
Speaker 3 (56:14):
I have no ideas, elizabeth, you know.
So I guess my question on thiswould be is it the person asking
the question or the spouses401k?
So since we're talking aboutdivorce, I'm going to say it's
the spouses and answer it thatway.
So in the quadra that wementioned earlier the qualified
domestic relation order thatwill be spelled out on that
legal form.
So usually with a 401k or apension, they're both treated
(56:41):
the same way.
It will be outlined what thespouse is supposed to receive.
The spouse is supposed toreceive, and once retirement
hits, then they will startreceiving those payments.
And there are ways to ensurethat you get those.
Like, let's say, your spousedies, there's life insurance
(57:01):
policies that you can put inplace to make sure that if they
pass away or they get fired fromtheir job or whatever the case
may be that you're still goingto be getting those payments.
Do you mind putting thequestion back up there?
I was going to go to the secondpart of the question.
Thank you.
Is it normal for the investor ofyour 401k to tell you how much
(57:22):
you can take out every year?
So that would be something afinancial advisor like myself
can tell you If you're at whatwe call required minimum
distribution age, which is 73 or75, depending on the year of
their birth.
There's a certain amount thatyou are required to take out
every year.
Otherwise there can bepenalties if you're under 59 and
(57:45):
a half.
If you're above 59 and a halfbut below that required minimum
distribution age, you take itout and you're taxed at your
income tax rate.
It's counted as income, butyou're not paying that penalty
fee.
So my advice to you would bedefinitely talk to a financial
professional about withdrawalsand how that may affect your tax
(58:08):
in your particular situation.
Speaker 2 (58:10):
Thank you, elizabeth.
Well, we've come to the end.
This was great.
Thank you so much, ladies.
Y'all all had a lot ofinformation, and I actually
learned a lot too, so thank youfor that that we have.
(58:34):
We will be putting this, asAlex said at the beginning, out
as a podcast.
We will have this availableafterwards, so we'll have all of
that on our social media.
So please look for that.
But thank you everybody forjoining us today and have a
great rest of your day.
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