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Dividing property is one of the most complex (and often contentious) parts of any Virginia divorce. Many spouses understandably want clear answers to questions such as: Who gets the house? What happens to the cars? Will I lose my retirement?
In Virginia, the answer to these questions isn’t always obvious. Courts used a system known as equitable distribution, which focuses on fairness rather than a 50/50 split. If you are concerned about how your marital property will be divided in your divorce, our Virginia Beach divorce attorneys can help you understand your rights and how to protect yourself financially in a divorce.
At Poole Brooke Plumlee PC we advocate for individuals in all types of Virginia family law matters, including divorce, child custody, and child support. We have a deep understanding of Virginia family law and how judges will likely apply it to your case based on your unique situation. Contact our law firm today to schedule a consultation with a Virginia family lawyer.
Understanding Equitable Distribution in Virginia
Virginia is an equitable distribution state. This means that courts divide marital property in a fair way based on the circumstances of the marriage.
Equitable distribution does not mean that everything is split evenly between spouses. In many cases, courts aim for something close to a 50/50 division. However, depending on the facts, they may award a 60/40, 55/45, or other split.
Virginia courts follow a three-step process to divide property in a divorce:
- Classify the property as marital property, separate property, or hybrid property.
- Value the property.
- Distribute the property equitably.
For the first step, the court must determine what property is subject to division. Marital property generally includes assets acquired during the marriage, regardless of whose name is on the title. Examples may include the family home, cars purchased during the marriage, retirement accounts earned during the marriage, bank accounts, investments, and personal property.
Separate property belongs to one spouse and is not subject to equitable distribution. This typically includes property owned before marriage, inheritances, gifts from third parties, and assets acquired after separation.
Hybrid property is a mix of marital and separate property. For example, a home that was purchased by one spouse prior to marriage, but both spouses paid off the mortgage together, is considered hybrid property. A retirement account that includes both pre-marriage and post-marriage contributions would also be hybrid property.
In these situations, only the marital portion is divided. Virginia courts often use the Brandenburg Formula to determine what percentage of a hybrid asset is a marital interest.
The next step will be to value the marital property so that a fair division of assets and debts can be made. This process is often straightforward, involving things like looking at account balances and getting a real estate appraisal. For high-asset divorces, valuation can often be much more involved and complex.
Finally, a Virginia court will decide how to divvy up the marital property between the spouses. Virginia judges rely on a list of statutory factors when dividing property. Key considerations include:
- Financial and non-financial contributions to the marriage
- Contributions to acquiring and maintaining the property
- The length of the marriage
- The age and health of each spouse
- The circumstances leading to the divorce
- Debts and liabilities
- Tax consequences of the division
- Any misuse or dissipation of marital assets
For example, a spouse who stayed at home to raise children and support the other spouse’s career may receive a larger share of certain assets to reflect their non-financial contributions to the marriage.
In dividing marital property, courts aim for fairness. This means that outcomes can vary significantly based on the facts of each case. If you want more certainty when it comes to the division of property in your case, then you can work out a property settlement agreement with your soon-to-be ex.
Our Virginia divorce attorneys are adept at negotiating divorce settlements that protect our clients’ interests. Coming to an agreement can often mean a less contentious and less expensive process, compared to going to trial. We can help you work out an agreement for property division, child custody, alimony, child support, and any other issues in your divorce.
Who Keeps the House in a Virginia Divorce?
The marital home is often the most emotionally and financially significant asset in a divorce. To determine who keeps the house, a court will first determine if the home is marital property. If it is marital property, then it will be subject to division as part of the divorce.
There is no one-size-fits-all answer to who will get the house in a Virginia divorce. Courts may use one of the following approaches:
- One spouse keeps the home, often with an obligation to buy out the other spouse’s share of equity in the property. This is common when one spouse can afford the mortgage, the children will remain in the home, and/or when one party has a stronger financial claim.
- The house may be sold if both spouses want to move on or if neither spouse can afford the home independently. The proceeds of the sale will then be divided.
- In some cases, one spouse may remain in the home temporarily, and the house will be sold at a later date. This is common in cases involving minor children, as the kids can often stay in their family home with the custodial parent until they reach adulthood.
Virginia courts will consider the statutory factors listed above when deciding who gets the house in a divorce. It is also possible to reach an agreement with your spouse about your marital home.
Who Gets the Cars?
Cars are usually easier to divide than real estate, particularly in marriages where the spouses own at least 2 vehicles. Generally, any car acquired during the marriage will be considered marital property. This means that these assets will be divided based on the principles of equitable distribution.
Courts often award each spouse the car that they primarily use, offsetting the value of vehicles with other assets. If a vehicle has a loan, it will be assigned to the spouse keeping the car. For example, if one spouse keeps a car with a value of $20,000, then the other spouse will receive $20,000 more from another asset (such as savings or home equity).
Dividing Retirement Accounts in Virginia
Retirement accounts are among the most valuable assets in a Virginia divorce. Broadly, retirement accounts are considered marital property to the extent that the funds in the account were earned during the marriage. This includes 401(k) plans, IRAs, pensions, and deferred compensation plans.
Even if a retirement account is only in one spouse’s name, the marital portion of the account is still subject to division. Virginia law allows courts to award a portion of the marital share of the account to the spouse who does not own it. However, the division cannot exceed 50% of the marital share of the account.
Pre-marriage contributions to a retirement account will remain separate property. Similarly, any post-separation contributions are also separate property. Any growth in the value of your account from pre-marital contributions may be partially marital property. Because retirement assets can be complex, valuation and division often require financial experts.
Most retirement accounts require a special legal order, known as a Qualified Domestic Relations Order (QDRO), to divide the funds without penalties. Our attorneys can obtain the proper documents to ensure that you are not penalized when splitting a retirement account.
What About Debts?
Dividing marital property also means dividing marital debt. Debts incurred during the marriage are generally marital. Debts incurred before marriage or after a separation may be considered separate property.
When dividing debts, courts will consider who incurred the debt as well as the purpose of the debt and who benefited from it. For example, a car loan for a sports car that only one spouse drives will be considered differently from student loans for a degree that benefited both spouses (and the family as a whole).
Talk to a Virginia Divorce Attorney about Your Case
Dividing marital property in Virginia is not about splitting everything down the middle. Instead, it is about reaching a fair outcome based on the unique circumstances of your marriage. Our Virginia family lawyers can help you understand your rights and will work to protect your interests.
Poole Brooke Plumlee PC understands that the prospect of dividing up your marital property can be a bit scary and overwhelming. We’re here to demystify the process, explaining how a court will likely rule and helping you achieve a settlement whenever possible. To learn more or to schedule a consultation with a Virginia divorce attorney, give our law offices a call at 757-499-1841 or fill out our online contact form.
