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Assets are the basis of our financial stability. They allow us to have a place to live and provide for our families. It’s not surprising, then, that property division is such a large part of the divorce process. It can also be just as contentious as child custody. For some people, concerns and misconceptions about property division can actually keep them from considering a divorce even when their marriage is not healthy.
A thorough understanding of how property is divided under Israeli law can play a vital role in making an informed decision, not just about divorce issues, but also about prenup financial agreements. You may find that a negotiated agreement could be in your best interests compared to what the court would order. If you have any questions or concerns about property division, Hait Family Law can provide the careful guidance and advice you need. Contact our firm today to learn more: (077) 200 8161.
What Assets Must Be Divided by a Divorcing Couple?
Under Israeli property relations law, couples who get divorced are generally subject to the default method of dividing property, known as a “resources balancing arrangement.” This method attempts to equitably divide assets between the couple by evenly splitting all the common property they have collected during their marriage. Assets that can be included in your common property are:
- Joint assets: Any items you and your spouse purchased together or anything you bought on your own while married are considered joint assets. This may include cars, homes, personal property, businesses, etc.
- Retirement assets: Except for your pension, any retirement assets you earned while married will probably be split following your divorce.
- Financial assets: Money you’ve accumulated during your marriage, such as savings funds, investments and stocks, mutual funds, and bonds, will be subject to division.
- Certain intangible assets: While it may be reasonably easy to split material property and financial assets, there can be other, less tangible property that the court may order you to divide as well, including intellectual property or “spiritual property.” For example, if your spouse wrote a popular song, you may be entitled to a share of the ongoing royalties as part of the divorce.
Keep in mind that while the resources balancing arrangement is the standard system for property division, exceptions can be made by the court based on the details of the situation and the wishes of the parties involved. If you decide to negotiate your own property division agreement to present to the court, it will likely be accepted. In many cases, this can be the best option for divorcing couples because they can each retain assets that are valuable or important to them, leading to less bitterness.
What Assets Are Likely to be Excluded From Division in a Divorce?
Not every asset you own will be subject to resource balancing. The court recognizes that some property types are not common assets, and you will not be legally required to split them with your spouse. These assets include the following:
- Pension funds: Pensions are not considered common property and will not be divided following a divorce. This includes old age pensions, pensions awarded due to a disability or handicap, and widow’s pensions.
- Property owned prior to the marriage: If you owned a business, vehicle, home, or other asset before your marriage, it should not be included in your common property because your spouse had no involvement in its acquisition.
- Some inheritances and gifts: An inheritance or gift that was only given to one spouse may or may not be included in a division of property. It depends significantly on how the asset was handled. As an example, if you were given a home and you rented it out and kept the profits from that venture separate from your family finances, it might not be considered a joint asset, and you may not be required to split it. If you have significant gift or inheritance assets, it is in your best interests to consult with a knowledgeable division of assets lawyer to understand how the court will likely handle them.
How Does a Prenup Agreement Impact the Division of Assets?
To entirely avoid the stress and hassle of having the court divide your assets during a divorce, you could choose to create a financial agreement, also known as a prenup, with your spouse before your marriage. The prenup must be signed by both parties and submitted to the Family Court for approval to be legal. The court will examine the document to ensure it is properly written. They also attempt to make certain that both parties appear to understand the terms of the document so that one partner is not treated unfairly without their knowledge.
If you have a valid prenup in place, the division of property in your divorce will follow the terms of that agreement. A well-written prenup can make the divorce process much easier and less costly for both partners because there will be no need to litigate financial issues.
One downside of a prenup is that if you realize during the divorce process that you signed a document that was not equitable, it is incredibly challenging to get it canceled. It may be possible in rare cases to show that you did not comprehend what you were signing. For instance, you may have a viable argument if you only speak English and the document was written in Hebrew, and you did not receive an accurate translation. To protect yourself from these situations, you should always seek the opinion of a trusted prenup lawyer before signing any documents.
While it may seem rather pessimistic to create a document that lays out what will happen if you divorce before you even get married, it is actually a useful legal tool and can provide peace of mind for both parties. Divorce is an unfortunate reality of modern life, and it is better to make a plan you never use than to be unprepared if the worst happens.
How Are Debts Handled in a Divorce?
Many couples take on debt to reach life goals, such as purchasing a home or starting a business. But what happens to that debt after your marriage ends? If you and your spouse accrued debt during the course of your marriage, that debt would likely be split evenly between both of you following the divorce.
In some cases, one spouse may be genuinely unaware that a debt exists because they were not involved in the financial decision. The “innocent spouse rule” exists to protect individuals from situations like these. If you can show that the debt was incurred without your knowledge, you may be absolved from responsibility for repaying it. A divorce lawyer can help determine if this rule applies to your specific case.
What Special Circumstances Can Apply to Anglo-Jewish Couples Looking to Divide Property?
The divorce process can be complex for individuals who are olim (immigrants to Israel) from the United States. These Anglo-Jewish couples may have property and assets in both countries and could be facing simultaneous divorce litigation in both places. Because Western Law can differ from the Jewish legal system, immense confusion and stress can result.
If you are facing this challenging situation, it is crucial to seek the assistance of a lawyer who understands the US court system and the Family and Rabbinical Courts of Israel because your divorce could involve all three. Hait Family Law has extensive experience in assisting Anglo-Jewish individuals with their legal needs, including divorce proceedings and the division of property. You do not have to go through this difficult time alone. Contact our law firm today to schedule a complimentary case evaluation.
What Rights Does a Wife Have to Property After a Divorce?
In some Jewish households, the husband controls the finances, and the wife has no ownership of property and no money of her own. Many women in this situation fear that they will receive nothing after a divorce and, therefore, will be unable to care for themselves. However, as discussed above, a wife is entitled to half of the assets accumulated during the marriage, regardless of whose name is on the assets, unless she signed a prenup. If a prenup exists, the assets will be split as outlined in the agreement.
Even if a wife has been excluded from the financial dealings of the household, it should have no impact on the extent of the assets allocated to her. A skilled property division lawyer can help you obtain the necessary financial information regarding your common assets. Your lawyer can also assist you in understanding how the property distribution is likely to occur, although, as with all divorce matters, the court will have the final say.
Will Your Financial Situation Change While You Are Going Through the Divorce Process?
Another concern for individuals seeking a divorce is what will happen to their finances while the divorce is being finalized. Many people, particularly women, are worried that the other spouse will stop paying bills and they will be unable to survive. Under the law, the spouses’ financial situation should remain the same during the divorce process as before the divorce. If one side unilaterally chooses to stop paying bills, the other spouse can take them to court to seek a solution until the divorce is finalized.
For many couples, negotiating an interim financial agreement is recommended to avoid these issues. This document ensures that both parties are on the same page regarding money and expenses in the short term, so no one is left in dire straits. This type of agreement can also allow you to begin separating your lives before the final judgment or divorce agreement goes into effect.
What Are the Advantages of Hiring a Division of Property Lawyer?
Discussions about money and finances can be uncomfortable and complicated. Emotions may run high during this stage of the divorce. Hait Family Law has years of experience handling these delicate but necessary conversations. Jay Hait is a trained mediator who can help you reach a division of property agreement that is best for your family. If mediation is not a viable option, litigation can also be used to achieve a desired outcome.
Whether you have more traditional assets or you are facing a complex situation with many types of assets and property from multiple countries, Hait Family Law can assist you. You deserve to receive your fair share of the joint assets you accumulated while married. You also have the right to protect assets from division if they belonged to you before the marriage. No matter the situation, we are here to serve your legal needs. Contact our firm today to schedule your complimentary case evaluation: (077) 200 8161.
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