What Is a Property Settlement Agreement (PSA) and How Do You Navigate One Successfully?
Courtroom drama gets all of the attention, but for many spouses, paperwork remains one of the most frustrating aspects of the divorce process. A key document is the property settlement agreement (PSA), which covers many economic and childcare concerns. Keep reading to learn more about PSAs and the role they play in divorce.
The Property Settlement Agreement Defined
Sometimes referred to as a marital settlement agreement, a divorce settlement agreement, or simply a settlement agreement, a PSA outlines how assets and debts should be divided between two separating spouses. Some PSAs focus exclusively on the financial aspects of divorce, while others delve into a variety of other concerns, including child custody, child support and alimony.
When Is the PSA Drafted?
A PSA can be created at several points during the divorce process, as long as the drafting occurs before proceedings are finalized. Occasionally, spouses will complete PSAs before they even file for divorce. In general, however, divorcing couples benefit most from formulating this essential document early on in the process, unless they strongly disagree on numerous terms.
PSAs and Third Parties
While completing your property settlement agreement, keep in mind that it is legally binding between you and your ex—not between the two of you and a third party. Creditors can therefore go after the other party if joint accounts are involved. Protect yourself by including stipulations allowing you to take legal action if joint debt issues arise.
Your Attorney’s Role in Property Settlement
Ideally, your PSA will be drafted by your divorce attorney, or at minimum, reviewed by your legal representative if drafted by your ex’s lawyer. At this point, the PSA is little more than a proposal; if you don’t agree with it, you’re not obligated to sign. The moment you sign, it becomes a legally binding contract, so don’t proceed until you feel entirely confident about the document’s terms.
What happens if you arrive at a solid agreement, and then your spouse refuses to play by the rules later? This Time Magazine article enumerates potential obstacles in your path. These problems include:
“Enforcing obligations to pay child support, alimony
Ensuring compliance with custody and parenting agreements
Non-payment of debts
Failure to list the family home for sale or refinance its mortgage
Improper division of assets
Failure to divide assets at all”
If you need help enforcing a PSA, or if you don’t understand the terms and conditions of a proposed agreement, ask a qualified Washington D.C. family law attorney. Look to DiPietro Family Law Group for insight about how to protect your rights and ensure fairness.
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