Divorcing couples under pressure from falling house prices

Many couples have felt the pressure of economic uncertainty and some of them have decided to separate. However, certain factors related to the economy are likely to influence divorce and, in particular, the way assets are divided, personal finance website This is Money notes.

The on-going recession and falling house prices have caused a drop in the value of many couples' assets. Typically, selling the family home and splitting the money has been the simplest way to divide assets and start afresh. This is no longer an option for many divorcing couples, as house prices are too low in the majority of areas across the UK, the website reports.

Financial experts believe that getting a new mortgage has become increasingly difficult, as lenders have tightened the conditions - they require bigger deposits and are more reluctant to lend. Тhis means that property assets are ruled out of the equation, forcing many divorcing people to move out and rent a new home.

Overall, shifting the focus to other assets, such as pensions, could prove a more effective strategy, experts advise. Pension pots are usually treated in one of two ways. The first is offsetting, where one of the spouses is granted a bigger share of the property, while the other is granted the right to receive their entire pension. The second is by having a sharing order, which splits the pension pot in two and both spouses are entitled to a separate amount of money. This option excludes state pensions, as they cannot be split, experts explain.

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