What is a premarital agreement?A premarital agreement, which is also often called a prenuptial agreement, is a contract entered into by two people before they get married. Terms of the agreements vary somewhat but they almost always include how property and debts will be divided in the event of a divorce.
Should I get a premarital agreement?
Asking one's potential spouse to sign and agree to a prenuptial agreement can be a difficult thing to do. However, a prenuptial agreement can be a wise move for someone who is very wealthy, is a business owner, has valuable property, or expects to receive a large inheritance. The rationale behind premarital agreements is the idea of limiting risk. A premarital agreement can help a person guard against losing a large amount of money and property in the event of a divorce.
What issues cannot be decided by a prenuptial agreement?
A prenuptial agreement cannot be used to decide child custody, child support or visitation rights. Courts use a “best interests of the child” test to determine issues related to child custody and visitation rights.
What must be disclosed before entering a valid premarital agreement?
Each party must disclose to the other their complete financial situation including all income, assets, and debts. If one party does not do this, the premarital agreement can be successfully challenged in court. For this reason, it is prudent for each party to be entirely honest about their situation and not hide anything.
What is required for a premarital agreement to be enforceable?
The agreement must be witnessed in writing and signed by both parties. The agreement cannot be entered into through any kind of duress or coercion. Both parties must have completely disclosed their entire financial situation and the agreement cannot unconscionable. An agreement will be considered unconscionable if it is substantially more favorable to one party and too unfair to the other. Premarital agreements that satisfy these requirements will be held to be enforceable.
Who is allowed to enter into a premarital agreement?
Any couple that is considering getting married can enter into a premarital agreement.
What is considered property for the purposes of a premarital agreement?
Property is anything that a person owns. Property can be real property, which includes real estate or any interest in land. Any property that is not categorized as real property is often referred to as personal property. This includes things like cars, stocks and bonds, DVD's, and savings accounts.
What state law will govern the premarital agreement?
Choosing what law will govern the premarital agreement is very important. If the parties do not have a choice of law clause in the premarital agreement, it is the law wherever they divorce that will govern the division of property. Therefore, a couple should specify what state's laws will control in the premarital agreement. For example, if a couple wants the law of the state where they get married to control, they should put that into the agreement.
What states recognize premarital agreements?
All 50 states and the District of Columbia recognize premarital agreements.
