In today's society, divorce is quite common. Though an amicable divorce is ideal, sometimes, parties cannot see eye-to-eye.
This may be especially true when it comes to large purchases during the divorce process. In the state of Michigan, such actions can have a serious effect.
With Michigan being a non-communal state, the courts treat marital assets as equal assets between the two parties. In other words, they split assets fairly. It is important to understand that "fair" does not always mean "equal." Rather, the intent of the distribution is to leave both parties on similar financial footing.
Large asset purchases
The origin of the funds is important. If the courts deem that the funds came from the purchaser's own assets, then the purchase fully belongs to that party. On the other hand, if the courts determine that the funds for the purchase came from marital assets, then the purchased item becomes a martial asset. However, the party who purchased the item would be responsible for the purchase price. In other words, the purchase price would come out of the purchasing party's portion of the marital asset distribution.
Though the purchasing party ultimately ends up paying the brunt of the cost of a large asset purchase during divorce, the other party may still have to deal with the depreciating costs of the investment in the large purchase. For example, the purchase of a new truck is a depreciating asset and would leave both sides with less liquidity. To avoid such situations, an individual may request a Funds and Business Restraining Order. This order would prevent the other party from making large purchases during the divorce proceedings.
Understanding these aspects can help determine the right options for your situation. It may also be beneficial to consult the actual divorce laws in full.