There are three main types of marital agreements: the prenuptial agreement, the postnuptial agreement, and the separation agreement. A separation agreement is a document that resolves the issues emanating from the separation of spouses, including but not limited to: custody, child support, alimony or waiver of it, and property settlement. This agreement can also address issues of tax payments and refunds, suits against third parties, whether or not the agreement is to be incorporated into a subsequent divorce decree and other ancillary topics. The parties can handle these issues in almost any way they agree.
The prenuptial agreement (“prenup”) is executed before marriage to resolve many issues in the event of a subsequent separation. It becomes effective only upon the marriage of the parties. Such agreements are often utilized when one party has significantly more assets than the other; a much greater income; or for second marriages, where a spouse wants to protect the interests of children born with the first spouse. Most prenups provide that assets owned by a spouse as of the date of marriage shall remain that spouse’s separate property and shall not be subject to equitable distribution in the event of a divorce. The agreement also should indicate whether the income generated by such separate property and whether personal property purchased with such income is marital or separate. Income earned during the marriage from employment may be addressed.
A prenup can determine the issue of alimony by providing for a certain amount of alimony per month and can even have a sliding scale based on the number of years the parties were married prior to separation. Of course alimony can also be waived. This isn’t true of a postnuptial agreement (“postnup”) which is executed after the parties are married. North Carolina prohibits any alimony treatment in a postnup; one must wait to separate to deal with it absent a prenup.
Postnups are utilized primarily to deal with property issues. I have used them in situations where the parties want to separate but cannot afford to have two households and pay a mortgage. The postnup can provide for the method of placing the house for sale, the distribution of the costs of the house pending sale and the distribution of the net proceeds upon sale. Of course, right before closing, the parties hopefully enter into a separation agreement resolving all the other issues.
The family law attorneys at Weaver, Bennett & Bland, P.A. are ready and able to assist you in determining the benefits of these agreements.
William G. Whittaker is a partner and family law attorney at Weaver, Bennett & Bland, P.A. Contact William at Weaver, Bennett & Bland, P.A. at (704) 844-1400. The information contained in this article is general in nature and not to be taken as legal advice nor to establish an attorney-client relationship between the reader and William G. Whittaker or the law firm of Weaver, Bennett & Bland, P.A.
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