Property Settlement Agreements
A property settlement agreement (PSA) is a binding contract between two married people who are anticipating a divorce. It commonly addresses issues of property division, debt payment, spousal support, child support and custody.
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The Benefits
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A property settlement agreement is a much less time-consuming and less expensive alternative to trial for resolving the issues arising from a pending divorce--such as how a divorcing couple's assets should be divided, who should pay off which debts, whether spousal support is needed and in what amount, how much time the children will spend with each parent and how much money is needed to support the children.
When asked to decide these same issues, a court must apply the state's statutory scheme and binding case law to the evidence presented at trial. A divorcing couple, on the other hand, can decide these issues without such constraints and can be more creative and flexible in their agreement. Resolving these extremely personal issues through negotiation and ultimate resolution in a PSA puts the divorcing couple in control, rather than a judge who is a stranger to their family.
Asset Distribution & Debt Repayment
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Typical distribution provisions assign each of the couple's assets and debts to one of the spouses and set a time frame for the transfer of those assets or debts. Additional provisions include agreements to cooperate in transferring accounts, signing over titles and refinancing debt into the name of just one spouse.
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Spousal Support
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Typical spousal support provisions in property settlement agreements set out the amount of support, the frequency of payments of support, the duration of support and the conditions under which payments of support may end before the expected termination date.
Child Custody and Support
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Typical child custody and support provisions determine where the children will live most of the time, how much time and under what circumstances the children will be with the non-custodial parent, and how much money the non-custodial parent will pay the custodial parent to assist in paying for the children's needs.
Warning
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A property settlement agreement is a legally binding contract that significantly affects a person's rights. This article is not meant to provide legal advice. Each state has its own set of divorce laws, and only a lawyer licensed to practice in a particular state may give legal advice as to a person's rights and responsibilities under that state's divorce law.
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