“We already have an agreement, why do we need to formalise our family law property settlement?” This is a statement family lawyers hear time and time again. The short answer is “Yes”. You really should formalise your family law property settlement because if you don’t, you may regret it in the future. Here are some reasons why….
Avoid paying transfer duty
If you formalise your family law property settlement under the Family Law Act you won’t have to pay transfer duty (commonly called stamp duty) on the transfer of property. No matter how many properties or the value of the property, if you have correctly formalised your property settlement, you will qualify for the transfer duty exemption on the transfer of property in accordance with the terms of the settlement. Often the savings in transfer duty are more than the legal costs to formalise the property settlement.
Prevent your ex from having a second bite of the cherry
Even if you have transferred property, distributed funds, or otherwise divided your assets by agreement, if you haven’t formalised your property settlement, you are not protected and either party can make a further claim against the other. The only way to prevent your former spouse from making a further claim in relation to property is to have a binding arrangement under the Family Law Act.
There is no such thing as a “gentlemen’s agreement” in family law. Just because your agreement might be witnessed by a justice of the peace, it is still not binding.
Peace of Mind
By formalising your family law property settlement you can have peace of mind knowing that your financial circumstances are secure. This is extremely important as you start the next chapter of your life following separation. It also means you can go buy that lotto ticket without worrying if your former spouse will come knocking on your door when you win!
It does not need to be difficult or time consuming.
Quite often when we advise clients to formalise their property settlement, they worry that it may be too hard or cause delay. If you engage an experienced family lawyer, you will be surprised how quickly and easily your matter can be finalised.
How do you formalise a property settlement?
There are two ways to formalise your property settlement, an Application for Consent Orders or a Binding Financial Agreement. Both options are binding and enforceable at law. To find out more about both options see our article “Consent Orders vs Binding Financial Agreements”.
Finally, if you engage a full service law firm like DBL Solicitors, you will have an experienced team to help you every step of the way. For example, once your family law settlement has been formalised, our property team can help you with the transfer or sale of your property, our commercial lawyers can help you restructure any business entities and our estates team can help you update your will and estate matters.
Should you, a family member or friend need legal assistance, please contact our office today.