Residential or commercial property, assets, and liabilities usually need to be divided and awarded equitably to each party in a divorce. How the court determines the worth of marital residential or commercial property consists of both fair market and intrinsic worths. It seems like this can make the divorce messy, however how Washington state divides these assets is quite simple. Keep reading to learn why we put worth on residential or commercial property, how the court determines worth, who figures out the worth, and more.

Why Do We Place Value on Properties, Assets, and Liabilities?

When the Washington state court system figures out a just and equitable distribution of the divorce celebration's residential or commercial property and liabilities, a worth should be put on these assets. Simply put, before a department of marital residential or commercial property, the court requires an entire image of the properties and liabilities 2 ex-spouses shared for a reasonable split in the residential or commercial property.

It is very important to note that in a neighborhood residential or commercial property state like Washington state, possessions and debts are listed as community or separate residential or commercial property. Generally, different residential or commercial property or properties and debts brought into the community are omitted from being divided. This can be tricky with items such as realty or services, however the court will do its best to figure out a pre-community worth and evaluate the department from that point on.

How Do the Courts Measure the Value of Assets?

Within the court system, they can position a reasonable market or intrinsic worth on your assets and residential or commercial properties. Each value involves something different, so it's vital to understand their differences.

Fair Market Price

Fair market price is the residential or commercial property's price when it's up for sale. For instance, how much could a hypothetical seller make from selling a residential or commercial property to a theoretical buyer? This worth uses to all property, including residential, industrial, and other owned residential or commercial property, like lorries.

Intrinsic Value

Intrinsic value is when you and your ex-spouse share residential or commercial property without fair market price. This includes clothes, home items, and other individual residential or commercial property. This type of worth is more subjective because the court must depend on the original purchase cost, the item's condition, replacement expenses, and any other aspects that can assist figure out the value.

Who Determines the Value?

Typically, appraisal experts will assist the court when identifying the fair market or intrinsic worth of marital residential or commercial property. These experts will have experience in depositions, reacting to discovery, and giving testimony to support their appraisal. The two divorced celebrations can concur in writing the set value of a residential or commercial property to eliminate the need for an appraisal professional. However, this is usually only suggested if the two celebrations concur.

Furthermore, there are a few methods to determine the worth of residential or commercial properties that you ought to never utilize. You must never ever use the following techniques because they can be unreliable and inadmissible:

- Using values listed on Zillow.com, Realtor.com, and other real estate sites
- An appraisal by your bank for the home purchase
- Using tax-assessed worths
- Using a "Comparable Market Report" from your Real estate agent

What Does a 50/50 Division of Shared Residential Or Commercial Property Look Like?

Washington state is a 50/50 divorce state. Typically, the court will divide all shared properties amongst separated partners similarly. However, this doesn't necessarily suggest everything will get divided in half. Usually, each spouse will get awarded their different possessions, while the net worth of community residential or commercial properties gets split 50/50 after computing their net worth.

So, how does the court divide community residential or commercial property in between you and an ex-spouse? Most celebrations believe they should offer their shared possessions to receive half of the profits. This is not how the court system divides this. Rarely will a court order a couple to sell their home or properties. Instead, each celebration is generally awarded entire items to balance the 50/50 contract.

To provide a much better example, let's examine what community residential or commercial property can consist of and how a court usually divides it. Let's state you share the following properties with an ex-spouse:

- A home worth $150,000 and a mortgage of $110,000.
- One partner's vehicle worth $5,000 and a $5,000 loan.
- Another partner's vehicle worth $10,000 and a $10,000 loan.
- A 401K pension with $80,000

The overall assets would equate to $245,000. The debt would amount to $125,000. Subtract the 2, and you have a net neighborhood value of $120,000. Half of this net value, or the quantity of money going to each celebration, would amount to $60,000.

For the court to distribute this quantity similarly, they may offer each partner a various residential or commercial property. For example, the court may award you the home ($ 150,000), the mortgage ($ 110,000), your vehicle ($ 5,000), the auto loan ($ 5,000), and $20,000 from the 401K account. Your ex-spouse would receive their automobile ($ 10,000), the vehicle loan ($ 10,000), and $60,000 from the 401K account. This divides the assets equally amongst both parties.

What Is the Difference Between Separate and Community Residential Or Commercial Property?

As you can collect, community residential or commercial property is any asset that the separated couple purchased or shared throughout their marital relationship. Separate residential or commercial property includes possessions acquired before the marriage or after the separation. Both meanings use to liabilities too.

While those distinctions are cut and dry, the Washington court system has numerous exceptions to these guidelines. If an item or asset was a present, unless offered to both spouses, it's thought about the separate residential or commercial property of whoever got it. Inheritances work the same way. An item might have gotten gotten before marriage however can get treated as neighborhood residential or commercial property if the divorced parties share the financial resources.

When different and community residential or commercial properties get commingled (when the court can not trace the possession), the court considers them neighborhood residential or commercial property. If different residential or commercial property incomes get utilized to buy something after the separation, they will likewise get considered different residential or commercial property. This is the "tracing guideline" and likewise works for community assets.

Knowing the difference in between separate and community residential or commercial properties and their type of worth can help you much better comprehend how the Washington court system will award you and your ex-spouse your marital properties. It's important that you work with a residential or commercial property division lawyer in a dissolution proceeding to make sure the value of all properties is true and accurate. Contact LaCoste Family Law to assist divide your possessions in a divorce.