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How can you spot an inaccurate valuation of assets in a divorce?

On Behalf of | Mar 11, 2024 | Property Division

In a New York divorce, assets are divided according to the equitable distribution principle. This doesn’t necessarily mean a 50/50 split, but a fair division of marital assets between spouses.

The court takes an unbiased approach, basing decisions on each spouse’s contribution to the marital assets and their future financial needs. By law, you could receive more or less than half of the total assets.

However, this equitable distribution can become complicated if there are inaccuracies in the valuation of certain assets. What if the court unknowingly assigns assets not accurately valued to a spouse? How can you spot such inaccuracies? These are essential considerations to ensure a truly fair division of assets.

Ways to spot inaccuracies

To protect your financial future, here are several ways to spot potential inaccuracies:

  1. Understand the value of different assets: Realize that some assets have different values. Real estate, businesses and other assets all have unique methods of valuation.
  2. Watch out for asset transfers: Sometimes, a spouse might transfer assets to a third party intending to buy them back after the divorce. Be alert for any such transactions.
  3. Look for sudden decreases in value: If the value of an asset suddenly drops without an explanation, it could be a sign of manipulation.
  4. Consider the timing of asset valuation: The value of some assets can significantly change depending on the timing. For example, the value of a business could vary greatly before and after a significant contract signing.

Divorce is an emotional time; the last thing you need is your spouse not being completely honest about asset values. So, it’s crucial to understand and be wary of any sudden changes regarding your assets.

Implications to minimizing values

Minimizing an asset’s worth can significantly affect your divorce settlement. For example, if the value of your shared home is underestimated, you might receive less money from its sale during property division. This could limit the funds you can use to invest in a new home or support your lifestyle. If you suspect your spouse isn’t being honest during divorce, it might be time to consider seeking an attorney. They can help advocate for a fair valuation.

Remember, getting each asset accurately valued isn’t just crucial—it’s your right. So, act now. Trying to correct inaccuracies in asset valuation later might involve costly legal fees and a lengthy process, with no guarantee of a change in the division.