Many people believe prenuptial agreements are the be all, end all of contracts. As it happens, an airtight prenup is extremely rare. There are a number of factors that can lead to a judge overturning a prenuptial agreement, but reaching that point is difficult.
A growing number of couples are signing prenuptial agreements before marriage. With 42 to 45 percent of U.S. marriages ending in divorce, it certainly isn’t a bad idea to protect your property and other personal assets. While a prenup isn’t the most romantic legal document, it can be helpful for a variety of reasons.
(Wondering how the prenup process works? Click here to access our free ebook on it.)
Many people are intimidated by it, but it actually puts legal power back into your hands. Instead of the state court determining the distribution, a prenup assigns property and debts to the appropriate spouse. This limits liability and helps couples avoid costly court proceedings.
Today, we’ll discuss 10 common questions we receive in regards to prenuptial agreements and how you can use one to protect your assets in the long-term.
1. What can and can’t be included in a prenup?
As far as provisions go, any sort of property can be included in a prenuptial agreement. This can include more obvious items like homes, vehicles, and checking accounts and can extend into other (more intricate) areas like life insurance, saving contributions or business ownership.
Debts are also outlined in prenuptial agreements and can be categorized as separate property. This prevents one spouse from being liable for the debts of the other if the marriage were to end. We recently wrote a blog that deep dives into the 20 most common items in prenups. Click here to read further.
2. What requirements must be met for it to be legally enforced?
General contract principles apply to prenuptial agreements and must comply with the statute of frauds. In other words, the prenup must be in writing and signed by both parties willingly. There cannot be any evidence of duress, coercion or undue influence. A notarized signature isn’t required; however, it is advisable.
From there, the court will consider other factors before upholding the prenup. Some of which may include:
- Is fair and reasonable provision made for both parties?
- If not, was a full, fair and frank disclosure of the parties’ worth made before execution of the contract?
- If neither of the above, did the parties, in fact, have a generally accurate knowledge of the others person’s worth?
3. Can a prenup be overturned?
As mentioned, a prenuptial agreement must comply with the statute of frauds. The most common defenses of fraud include duress, mistake and unconscionability. Fraud and misrepresentation fall under financial issues while coercion and duress fall under timing. Be mindful during the planning and drafting stages in order to avoid these potential defenses.
4. How is shared property assessed in a prenup?
Ownership is based on the financial contribution of each party. For example, a husband may own 80 percent of the art collection while his wife may own 20 percent. And, each party will own 50 percent of all other shared property.
5. How are shared debts assessed in a prenup?
Financial responsibility is very similar. The distribution of debt is based on the contribution of each individual party. For example, a husband may be responsible for 75 percent of a renovation project while his wife may be responsible for 25 percent. However, each party is responsible for 50 percent of all shared debts outside the renovation costs.
6. Can a party be entitled to more than one type of support?
A prenup can entitle a party to more than one type of support. If you and your spouse were to divorce, they could receive a lump sum payment as well as fixed monthly payments.
7. Can I restrict or waive child support in a prenup?
Child support cannot be determined in a prenuptial agreement. In this case, the court will follow state guidelines in accordance with the “child’s best interests.” Parents don’t have the right to waive child support, custody or visitation by contract.
8. What are additional clauses?
Additional clauses allow you and your spouse to include your own provisions on issues a standard prenup doesn’t cover. We recommend avoiding clauses unrelated to property or finances. Keep in mind, provisions like home cleanliness and fidelity aren’t legally binding in court and can run the risk of the judge revoking the agreement.
9. Can we modify the prenup after we’re married?
Generally, you’re able to alter the terms of the prenuptial agreement. However, all changes must be in writing and signed by both parties. Keep in mind; other items in the agreement will remain intact unless you revoke the entire document in writing.
10. Should my fiancé and I seek separate counsel?
While it isn’t required, we highly recommend enlisting separate counsel for you and your spouse. An attorney who drafts the agreement will typically represent one party while the other is encouraged to review the document with their own before signing.
While no one is thinking of divorce at the time of marriage, it’s important to protect your personal assets and property. Prenups have a stigma to them. But, at the end of the day, they’re there to ensure a fair division of property (outlined by you and your spouse vs. the state) if the marriage should fail. To learn more about prenuptial agreements and the filing process, reach out to us today at (405) 701-6376.
Wondering How to Get Started?
If you and your fiancé are considering a prenup, we’d love to provide some resources to get you started. In this free ebook, we highlight key provisions the contract protects (and doesn’t) as well as our tips for drafting. Click below to access your free copy of the guide now!