Prenuptial Agreements: Full & Fair Disclosure of Assets

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An increasing number of individuals are interesting in having a prenuptial agreement prior to getting married. The idea is that if the marriage does not work, the divorce can be simplified.

Many hear horror stories of divorces their friends or family members have gone through. They do not want to worry that this will take place if their marriage does not work.

It is true that parties can enter into a prenuptial agreement that deals with important issues in case of divorce. For example, a prenuptial agreement can address property and debt division, spousal maintenance and attorney’s fees.

While many are not aware of this, prenuptial agreements (also called antenuptial or premarital agreements) cannot address child custody and child support. This makes sense when you think about it. While not all parties, most enter into the marriage without having kids. Thus, it is impossible to address issues involving children who are not even born.

One formality that many do not realize the importance of is a full and fair disclosure of assets and debts prior to the prenuptial agreement being signed. In other words, both parties are supposed to disclosure all the assets and debts that they are bringing into the marriage. Disclosing income is also important for a prenuptial agreement.

Many parties in a rush to get married might want to bypass this step. They might just now want to take the time to disclose the assets and debts they have. Others may not want their prospective spouse to know.

However, there are court decisions throughout the country where prenuptial agreements being set aside because assets, debt and income were not full disclosed. This is because a party cannot knowingly waive any rights they may have if they do not even know it exists.

This is why parties entering into a prenuptial agreements really ought to take their time. The financial statements should be completed properly. Values should be listed as accurately as possible. Identifying information such as account numbers and the companies holding these accounts should also be listed.

Parties are also wise to go back and look at statements concerning assets and debts. This ensures that they are not guessing as to values.

Parties who abide by this important step have a better chance of having the prenuptial agreement enforced if the marriage were ever to end in divorce. On the other hand, parties who try to side-step this important task face significant risks.

DISCLAIMER: Because of the generality of this update, the information provided herein may not be applicable in all situations and should not be acted upon without specific legal advice based on particular situations.

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