Simple postnuptial agreement for american expats.
December 23, 2016 4:44 AM Subscribe
My wife and I (one child) need to make a *simple* agreement that concerns only one thing: money that will potentially be given to her by her parents to purchase a property here in Germany. I have several questions about this before going to a lawyer or notary.
1. Her parents would like her to have the property as a form of financial security in case of separation. Though we might need to iron out some details, we are in agreement about this, since it will benefit us both to be able to purchase something here.
2. The basic idea is her parents will give her a sum of money, which will remain hers in case of separation, and once a property is bought (for which the money would only be a down payment), the property would be divided (in case of separation) according to how much money each of us have put in. Plus: she would be able to decide whether to stay in the property (to "buy out" my share).
3. We don't want anything about other assets, children, etc.
4. Do we need American or German lawyers and notaries? (We were married in California)
5. For such a simple case, is it possible to draw up a short agreement, perhaps even using a freely available template?
6. We want to make this as quick and easy as possible.
7. Any further suggestions or questions are welcome.
1. Her parents would like her to have the property as a form of financial security in case of separation. Though we might need to iron out some details, we are in agreement about this, since it will benefit us both to be able to purchase something here.
2. The basic idea is her parents will give her a sum of money, which will remain hers in case of separation, and once a property is bought (for which the money would only be a down payment), the property would be divided (in case of separation) according to how much money each of us have put in. Plus: she would be able to decide whether to stay in the property (to "buy out" my share).
3. We don't want anything about other assets, children, etc.
4. Do we need American or German lawyers and notaries? (We were married in California)
5. For such a simple case, is it possible to draw up a short agreement, perhaps even using a freely available template?
6. We want to make this as quick and easy as possible.
7. Any further suggestions or questions are welcome.
The gift, in of itself, isn't hard to deal with and doesn't necessarily require a post-nuptial agreement. California is a community property state, meaning any asset acquired or income earned by a married person while living with a spouse is considered to be jointly owned. However, that doesn't play into things that are deemed to be Separate property, which includes assets brought into the marriage by gift to a specific spouse. In the event of a divorce, all that really is needed to protect that specific sum of money is a clear document from her parents to the both of you that indicate this sum of money x attached to this letter, is a gift solely for spouse, and not for the benefit of both parties. All parties sign in acknowledgement, notarization will also strengthen the document. From the California law perspective whether it was notarized in Germany or America doesn't necessarily matter, but requires an extra step in the event of a divorce to translate and legitimize the German document into american courts.
Where a lawyer will be helpful is helping you think through the different scenarios and drawing up an agreement as to how exactly those assets would be divvied up on a divorce. Will you force a sale of the house to recover the assets? What if one spouse decides they want to live in the house? What if one spouse doesn't have enough assets to buy out the other spouse? What if the house is underwater?
posted by Karaage at 5:52 AM on December 23, 2016 [2 favorites]
Where a lawyer will be helpful is helping you think through the different scenarios and drawing up an agreement as to how exactly those assets would be divvied up on a divorce. Will you force a sale of the house to recover the assets? What if one spouse decides they want to live in the house? What if one spouse doesn't have enough assets to buy out the other spouse? What if the house is underwater?
posted by Karaage at 5:52 AM on December 23, 2016 [2 favorites]
A simple write-up with notarization may or may not work in all the places you need it to. (I am not an estate, trust or family lawyer, but my expectation is that it would not work everywhere.) But Karaage identifies the points that (after doing whatever is necessary to make it work everywhere) a lawyer is important to help with: what if your prediction of what happens is wrong? What if what seems fair now turns out to be unfair (or to seem unfair to one of you) later, when you try to implement the split?
Sorting that out is what you should use the lawyer for. You can speed things up by figuring out (and writing down, if necessary) what you want to happen, but it's pointless to spend time trying to put it in legalese or figure out what notaries you need, because you're very unlikely to do that correctly, and it distracts from figuring out important details of what you want.
posted by spacewrench at 7:05 AM on December 23, 2016 [1 favorite]
Sorting that out is what you should use the lawyer for. You can speed things up by figuring out (and writing down, if necessary) what you want to happen, but it's pointless to spend time trying to put it in legalese or figure out what notaries you need, because you're very unlikely to do that correctly, and it distracts from figuring out important details of what you want.
posted by spacewrench at 7:05 AM on December 23, 2016 [1 favorite]
You will be resident in Germany, the house will be in Germany, and you would be divorcing in Germany and subject to German dissolution law. Under German divorce law, when a couple splits, each party takes whatever they came into the marriage with, and all assets accrued after marriage are split evenly. This can be amended with a post-nup agreement; however, I believe this needs to be done and notarized in Germany. Your agreement would be made under a Notariat not a lawyer.
posted by DarlingBri at 7:50 AM on December 23, 2016
posted by DarlingBri at 7:50 AM on December 23, 2016
You will be resident in Germany, the house will be in Germany, and you would be divorcing in Germany and subject to German dissolution law.
I'm not sure that these are all true, just looking at the original post. It would be good if the poster could clarify, because I think it might affect the answer. E.g., the answer might well be different if the couple isn't planning on staying long-term in Germany, but might return to California.
posted by praemunire at 8:54 AM on December 23, 2016
I'm not sure that these are all true, just looking at the original post. It would be good if the poster could clarify, because I think it might affect the answer. E.g., the answer might well be different if the couple isn't planning on staying long-term in Germany, but might return to California.
posted by praemunire at 8:54 AM on December 23, 2016
Response by poster: To clarify: we are hoping to return to the U.S. at some point, say in the next 2-4 years, but it is unclear when (and it depends on finding employment). And of course we're not currently planning to get divorced :). Thanks for all the answers so far.
posted by melamakarona at 9:09 AM on December 23, 2016
posted by melamakarona at 9:09 AM on December 23, 2016
Personally, I think buying property in a country you are not going to stay in is a very bad financial choice. You will lose flexibility and complicate your finances and taxes. Also when you move the cross border ownership and maintenance of property would be a management nightmare.
Unless you're counting on this as rent relief I'd say you are better off with you wife putting it in some sort of more liquid investment.
posted by srboisvert at 3:21 PM on December 24, 2016
Unless you're counting on this as rent relief I'd say you are better off with you wife putting it in some sort of more liquid investment.
posted by srboisvert at 3:21 PM on December 24, 2016
Also closing costs and legal fees will wipe out a lot of earnings/savings in a short time frame like under 5 years. Maybe even under 10 years.
posted by srboisvert at 5:44 AM on December 28, 2016
posted by srboisvert at 5:44 AM on December 28, 2016
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posted by parmanparman at 5:44 AM on December 23, 2016