COVID-19 and its impact on Divorce financial orders
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The Covid-19 pandemic represents a ‘black swan” event and the repercussions will have a significant impact on society.
COVID-19 is not just a global health crisis – it is also having a devastating impact on the economy, jobs, stock market, businesses and the property market. Most assets would have depreciated sharply in value at this time.
What are the financial considerations if you are contemplating a divorce or going through one during this COVID-19 crisis?
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Has COVID-19 affected you or your spouse financially?
First of all, it would be essential to consider seriously how much effect on finances COVID-19 has brought or is likely to bring to you and your spouse.
You may find, once you have done a serious re-think about your finances and done a new valuation on matrimonial assets, that your previous stand on a settlement may no longer be viable with COVID-19.
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Get the latest valuation on matrimonial assets
It is also critical to obtain new valuations on matrimonial assets. With the economy likely to fall into a deep recession, it makes sense that matrimonial assets are re-valued and divorce settlement strategies re-assessed. To reach a fair settlement, you need to have reliable and up to date valuations.
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Impact on division of matrimonial property
The loss of a job or a pay cut his could have an impact on how matrimonial properties are split. If one party wants to buy out the other party’s share in the matrimonial property, parties must re-examine and decide if that is still viable in light of falling property prices. If the matrimonial property is to be sold in the open market, there may be challenges to getting it sold if social distancing measures are still in place and no one is viewing the property.
As divorce lawyers, we frequently find that both spouse are eager to buy over the other spouse’s interest in the properties because of the lower valuation, in expectation that property prices will rise in the future. So, the issue of who buys and who sells is an issue that must be resolved.
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Will the bank lend money?
It is also uncertain whether banks will lend one party the amount required to buy over the property. A lot will depend on valuation, interest rates and buying party’s financial strength.
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Maintenance
Payment of spouse and children maintenance is another area that couples must look at now. Bear in mind that if you reach a agreement on maintenance based on the dire economic situation now, your spouse may ask for an increase in maintenance if the economy and your financial position significantly improves in the future.
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Conclusion
If you and your spouse are reasonable and fair, a financial divorce settlement is still possible. Consult us at tel 6854-5336 if you require legal representation on a divorce settlement.
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ABOUT PKWA FAMILY LAW
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At PKWA Law, our team of Family Lawyers are consistently named as leading Singapore family and divorce lawyers by respected legal publications such as Benchmark Litigation Asia Pacific, Asian Legal Business, Singapore Business Review and Doyle’s Guide to Leading Singapore Family & Divorce Lawyers. Contact us at tel 6854-5336 for a free first consultation.
