Change of Title upon Divorce/Seperation

[Ronulas5]

Gday' all,

Looks like my marriage may be ending soon.....sigh

Can anyone tell me if you can transfer property over to your ex spouse witout having to go through the hassle of capital gains ect. ie do you have to actually sell it to your ex or is there some other way?

Also, I assume the bank will want some input as my wife has no income as yet. Will the bank require we sell the properties?

Thanks

 

[Modal Harmony]

Hello, I don't know your particular situation, but if you can avoid the divorce path, please do so! Apart from the property issues you mention, you and your wife will lose a history that you created together since say "I Do".

Can I suggest a viewing of the film "The Story of Us" with Bruce Willis and Michelle Pfeiffer. Whether this helps you or not, I can't let your post go by without this reply.

Good Luck!

 

[josko]

Hi Ronulas5,

That's sad news.

I have heard you will have to pay S/D in NSW no matter what to transfer titles.

I could be wrong though.

What you can do is drop the rpice right down so as to avoid CGT.

For example:

If a valuer values the house at 500k. You previously bought for 400k.

Your share is actually 240k. (- 50% S/D & legals)
Sell to your ex for 420k(includes previous S/D + legals) -

So no Capital Gains Tax.

Ex takes out a mortgage on the house to pay you back your 240k.

You would also have to have a seperate doc drawn up by your Solicitor that your ex will agree to pay you $240k on the settlement of the house.

It's just my opinion, but the new S/D on the property should be her's to pay for. After all, you need to go and buy a house too.

I have not been through a divorce, but it must be a horrible time for you, hopefully it wont come to this??? Good Luck.

I just noted your last question. "Properties?" You really need to speak to your accountant. There is too much involved. Are they in Trusts? Is there a mortgage involved in all properties? How is wife going to pay you out?
Regards Jo

 

[Raddles]

HI there
if you do end up divorcing, it is in your interest to have consent orders approved by either the Family Court or Federal Magistrates court.
If you then transfer property pursuant to those orders you will rollover cgt and there should be no stamp duty - as this sort of situation has an exemption under the duties legislation.
Please don't do anything before you get proper advice.
thanks

 

[Sunder]

HI there
If you then transfer property pursuant to those orders you will rollover cgt and there should be no stamp duty - as this sort of situation has an exemption under

That's my understanding too.

Ronulas,

One of my closest friends is a family law specialist, and a damned good one. If you have very specific questions, I'm having dinner with him tomorrow night.

It's easy for us to say "sorry to hear about that, please try to avoid divorce" but from the tone of your first post, it sounds like you're more... resigned than upset/angry, and that tells me this has been a long time coming.

It's not for me to say whether you should keep trying or not, even though, as a guy only dating and madly in love, the idea of divorce seems anathaema to me... But perhaps if you went to a mediator together, rather than take a family law specialist each, you could sort out what your respective desires are out of the separation, and save both a lot of money - and if the mediator happens to be a genius... Possibly find more than just common financial settlement goals for you two to work on.

 

[Miss V]

Having had to do a bit of research on this myself lately, I found the Office of State Revenue website quite interesting. Not sure of the address but a search should bring it up.

 

[Ronulas5]

More info

Thanks for responsors so far,

Just to give some financial backround,

We have 1 IP and 1 PPOR.
She has moved out and moved into IP which is being rented by a friend of hers.

Problem with that is i guess the IP is not really an IP anymore with her living in it?
She wants me to have the IP and keep the PPOR for herself and three of the kids. I have one child still with me. I am concerned about the fact I would be up for Capital Gains if I sell the IP and she would not as the house has always been a PPOR.

The PPOR is worth more but I am not concerned with that as she has aggreed to leave my superanuation alone.
At the moment I am paying for everything which is fine but I don't believe I can do that for long as she is now receiving most of the Familly Assistance which amounts to $700 a fortnight.

I guess I am blathering a bit because there is no one else to tell. Sorry about that.

I guess I am mostly concerned with providing for the kids without being used by my ex. I don't want to go to court and hope we can work things out equitably. Because the market is slowing down at the moment neither one of us wants to sell but I don't think my ex will be able to afford the payments on either of the houses.

 

[Raddles]

Hi there
I do think you need to see a family law practitioner so you can get an idea of what is involved. They can advise you on the implications for the kids, the property and the family assistance payments
There have been huge changes to the family law scene in recent years and before there is any court action - there has to be mediation.
Mediation can be quite successful if the mediator can facilitate you both talking and sorting things through. The children will be the first priority and property will come second. Please consider consent orders - it is possible to DIY without incurring a lot of costs. If you look at the Family Court website - you will see they post a lot of the DIY kits for people.
The first thing to do is get informed.
thanks

 

[Sunder]

I guess I am blathering a bit because there is no one else to tell. Sorry about that.

I guess I am mostly concerned with providing for the kids without being used by my ex.

I don't think my ex will be able to afford the payments on either of the houses.

Feel free. Posting on blogs can be very cathartic Nobody here is going to judge you over it.

The IP is still an IP to YOU, so you can still keep claiming all expenses. If you gave any concessions to her friend in terms of rental discounts, you might consider revoking them at the next rent review.

In terms of CGT, if you don't sell, you don't pay? Would you consider turning it into your PPoR?

That's the tough bit isn't it? If you try to keep too much from her, while directing it to the kids, she may take you to court.

Are you also aware that she's most likely entitled to spousal support from you, which means, in addition to the family support she's receiving, she may be able to pay off the house?

But as Raddles said - get some professional advice.

 

[Ronulas5]

Thanks Sunder,

I'm not trying to keep anything from my Ex that she is entitled too, just trying to protect myself and by extention the kids.

Both properties are in both our names, although I am the only one able to service the loans. She is attempting to find work, but who knows how long that will take.

I would gladly make the currnet IP my PPOR however I don't want to have to keep paying for both houses. I would like her to take over payments for one of the properties while I pay for the other one. That way we get to keep both properties until it is a good time to sell.

I believe that by the time the Child support agency looks at how manny bills I am paying there will be very little left for maintenance. Private school fees, Credit Cards, Other loans, House payments, Car loans ect.

Also now that she is receiving all the Familly Assistance we were receiving I am not even sure I can pay what I was paying befor. $700 p/f at least.
I am struggling to maintain a compliant attitude as it is and now she want to swapp houses ect. I can understand this as she has three of the children and I only have one. She needs the space but I do not believe she can afford the repayments as i said earlier.

Thanks

 

[Sunder]

That sounds fair enough.

Unfortunately, you can't really stop the payments until the title is settled, otherwise you're not really paying your own house either...

It does sound like you need to get everything down on paper - first by a mutually agreed mediator, then get a judge to ratify it, and have the properties properly transfered to the respective names, free of CGT and stamp duty.

At that point, you can stop payments on her house.

Remember, nothing is legal until the judge ratifies your agreement, and the ink is dry on the transfer. You could draw up a contract saying she has the rights to the first house, but if the judge does not agree that this is a legal and equitable split, anything can happen after that.

 

[granev]

Hello Ronulas

I know how you want to keep away from the courts/lawyers etc , but you seriously need to get some advise.

Ask around , find a lawyer , usually the first half hour is free , you dont have to take any action but just talk.

From there you will have a better idea where you are at.

But from what you have detailed about your and your ex,s situation , it might just be that selling up , divying up and starting again is best - although it may seem like it , it is not the end of the world.
You said you both have shared credit card debt , car loans , other loans etc , these have to be sorted , you can no longer owe anything together.

Your financial situation seems a bit messy , my personal advise would be to clear it up , see whats left then work it out.

But I cant stress enough - get some advise.

And yes I have been there and done that

 

[Dazz]

1. Give everything to the wife. Keep nothing.
2. Go rent a caravan.
3. Start again.

I haven't been there and I haven't done that - but that's what I'd do.

That way, the wife and kids get absolutely everything - and the nice friendly lawyers don't get a cracker.

 

[Sunder]

1. Give everything to the wife. Keep nothing.
2. Go rent a caravan.
3. Start again.

I haven't been there and I haven't done that - but that's what I'd do.

That way, the wife and kids get absolutely everything - and the nice friendly lawyers don't get a cracker.

Man, that's harsh...

 

[fernfurn]

Be careful you dont agree between yourselves on who gets what, because if it hasnt been ratified in court, they dont care what has gone before and if you finally get divorced 2,3 ? years down the track (and she has spent all you gave her) the court will just divide what you have then (in 2,3?) years and whatever you have gained in that time she will get half or more of again, Friend of mine agreed to divide things in half, and 3 years later she went to court and got half of what was left. (I am female and divorced and have heard tragic bitchy nasty stories from both sexes) Why is a women like a hurricane, cause she's wet and wild when she comes and when she goes, she takes everything with her. You can do you own divorce, and settlement, agree on everything, get it down on paper, then take it to a solicitor to be ratified in court. No stamp duty in Vic if giving to other partner because of divorce. Solicitor cost me about $500 18 years ago.

 

[tor]

Man, that's harsh...

Not that harsh. He recommends a course of action which makes moving on an option.

If Ronulas expends a lot of energy on the equitable agreement and things go pear shaped there could be a lot of rancour.

Given that Ronulas has built this particular financial situation (apparently by himself) with no financial help from his wife it would stand to reason that he can do it again.

If there are any feelings (surprising if not) towards her they can be assuaged by giving her everything.

Then he is once again his own man to succeed or fail on his own feet.

With what we know of the emotional situation (nothing) this is just as valid advice as anything else in this thread.

The act of giving everything would be significant. As a male I would feel a certain pride in being able to throw away all the trappings of my life and start from scratch. Realistically a lot of people going through this kind of thing become quite twisted people as they negotiate over _everything_. That amount of baggage means they can't move on either, limbo land. pee yeew.

Perhaps Dazz may have given some reasoning for his answer but hell, advice is generally no better than what you pay for it (couple of KB of advice on a monthly plan is nothing).

 

[Tizzy]

Hi, you can access a great deal of information through the Relationships Centre. These are Commonwealth funded resources available throughout Australia to help people who are hoping to keep their relationships together and those who are separating. Doesn't matter what issues you are dealing with in a relationship, hopefully the Relationships Advice line can point you in the right direction to get the information you need.

There is a telephone number you can call to get unbiased up to date information on family law and any other issues people have to deal with when separating.

1800 050 321.

Good luck. They will be a useful resource for finding out about Centrelink entitlements also. I should add, they can be instrumental in helping to establish a co-parenting plan.

 

[RumpledElf]

You will get some of that parenting payment if you have the kids a decent fraction of the time, even as much as just weekends. Best to be upfront with Centerlink about everything.

I have to say I second the notion of selling both houses and splitting the profits 50/50 (or some other fraction). That way you could buy yourself at least a unit, she could buy a house (maybe downsized so a smaller debt left) and neither of you have to live in a house full of memories.

 

[Sunder]

The act of giving everything would be significant. As a male I would feel a certain pride in being able to throw away all the trappings of my life and start from scratch. Realistically a lot of people going through this kind of thing become quite twisted people as they negotiate over _everything_. That amount of baggage means they can't move on either, limbo land. pee yeew.

Perhaps Dazz may have given some reasoning for his answer but hell, advice is generally no better than what you pay for it (couple of KB of advice on a monthly plan is nothing).

The thing is, his future is one of the things the court could order "given away", like garnish his wage 60% until all the kids at 18, then 30% forever thereafter, would not be an impossible (though unlikely) option - and considering he has 4 kids, I doubt he's 30, and ready to start all over again.

 

[Ronulas5]

Actually I'm 36. Thanks for all your kind responces.
I am resigned to the seperation now although I do feel a certain amount of grieving....

We are working amicably on the financial side of things which is good I suppose. Unfortunatly because my wife has no job alot of the financial burdon will rest with me. We don't want to sell out properties so I will pay for both until she gets a job at which time she may take over one of the payments. She is living in one property with 3 kids and the old tenant who is a friend of ours while I live in the other with our 15 year old son.

She is making payments towards the car she has taken at least although I'm not sure she can afford the insurance and rego when they are due. I'm notsure my wife really knows the cost of things as I have always taken care of the bills ect.

Anyway, I appreciate your kind comments