Podcast: What should you do with your property when divorcing in Scotland?

In this episode of the ESPC Property Show, Paul and Megan are joined by Sally Nash & Aimee Orrock from Gilson Gray to discuss what happens during the divorce process in Scotland and how property can be divided when a couple separates.

They also cover the potential impact of economic disadvantage, especially for those who have taken career breaks for family reasons, and the relevance of prenuptial agreements. Whether you’re going through a separation or simply want to understand the process better, this episode offers valuable insights from experienced professionals.

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Key Insights

Don’t rush into decisions

In discussing What should someone do in the early stages of separation when it comes to their property, Sally explains that making hasty decisions can put them at a disadvantage. It’s best to take a breath and seek legal advice before doing anything, as early decisions about property can lead to irreversible consequences, especially when there are other assets involved that might come to light later. Involving a family lawyer early on is critical to avoid conflicts of interest if the same firm is used for selling the property.

Divorce doesn’t always mean the end

Some couples are unsure if they want to fully separate and just want to understand their financial situation first. In these cases, having the financial facts can sometimes help a couple make an informed decision about staying together, rather than making decisions out of fear or uncertainty. Reconciliation does happen, although it’s not the most common outcome.

Who gets what during a divorce?

Scottish law offers flexibility for couples to agree on terms that suit them best in regard to division of assets. While some couples are able to come to their own agreements, even if they deviate from what the law suggests, Sally's team often helps couples formalize these decisions in legally binding agreements. And if an agreement can’t be reached through negotiation, mediation, or collaborative law, the court becomes the last resort to make these decisions. The court process, however, can be complex and lengthy, which is why many prefer to settle outside of it.

Occupancy rights and financial obligations

It is very difficult to legally force someone to leave the family home, especially if both parties have a right to live there. Even in cases where one partner doesn’t own the property, as long as they’re married and it’s a family home, they have occupancy rights. To exclude someone from the home, a court application is necessary, and the bar is set high. Even when one household becomes two, spouses have a legal obligation to support one another financially, and this doesn’t only arise at the point of separation - it’s a responsibility throughout the marriage.

What happens to the marital home?

The decision of whether the marital home should it be sold or should ownership be transferred to one party largely depends on the couple's financial circumstances and emotional attachment to the property. If children are involved, one party may prefer to stay in the home for stability, but this depends on affordability. If one party wishes to stay, they need to be able to buy out the other person’s share or make other financial arrangements. It's important to seek professional valuations and speak to financial advisors to assess what’s possible. In some cases, downsizing might be the best option for both parties.

Court involvement can prolong the divorce process

Although sometimes necessary, court involvement can extend the timeline of a divorce. The general advice would be to avoid court if possible and to work toward a resolution through other means, such as negotiation or mediation.

The division of shared assets

The division of assets is not always 50/50. While the law aims for fairness, often meaning equal division, certain factors like economic disadvantage can justify an unequal split. For example, if one spouse gave up a career to care for children, they might receive more than half of the shared assets to compensate for lost earnings.

Pensions and divorce settlements

Pensions are a key asset, sometimes as valuable as other major assets like a home. They are valued based on the separation date, and the portion accumulated during the marriage is considered for division. This can become especially important in military families or situations where one spouse had to sacrifice career opportunities.

Prenuptial agreements in Scotland?

Prenuptial agreements are becoming more common and are enforceable in Scotland unless deemed unfair. These agreements help define what happens to pre-marital assets and can offer protection, especially in second marriages where children from previous marriages are involved.

Why is professional legal and financial advice important in divorce?

Getting proper legal and financial advice is crucial to ensure a fair division of assets. Many people assume a 50/50 split is automatic without considering other factors that may justify a different outcome. Professionals can help couples navigate complex financial situations like property valuations and pension entitlements.

 

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