What is a Mid-Nuptial Agreement?
You’ve heard of prenuptial agreements. But have you heard of mid-nuptial agreements? Probably not. But it’s becoming more popular among couples for a variety of reasons.
Prenuptial agreements involve terms for settling the divorce estate before the marriage is finalized. Midnuptial agreements, on the other hand, occur during the marriage. In some cases, a couple may not want to end their marriage, but they’re in a position where they want to settle the financial aspects of a potential divorce. In this case, it isn’t too late to draft an agreement on how your finances would be split if you did divorce. The process is colloquially known as a mid-nuptial agreement. It’s helpful for couples that are separated or separating and want some surety on how their assets will be divided.
What you need to know about mid-nuptial agreements
You don’t necessarily need to be separated or separating to draft a mid-nuptial agreement. In many cases, spouses start businesses while they are still married. Any major change to the marriage, especially beginning a new business, can have a broad impact on your marital estate. In terms of businesses, any business that was begun during the marriage is technically part of the marital estate. If you want to ensure that the business is not divided in the event of divorce, you will need a mid-nuptial agreement to hammer out the fine print.
Several potential uses for a mid-nuptial agreement
While protecting a business is one of the most common reasons for a mid-nuptial agreement, there are other potential uses as well. It can also be used to divide real estate assets, retirement funds, and other assets that are important to one spouse. In these cases, the spouses can agree that if the marriage did end, that the property would not be divided during the divorce.
While many spouses will use a mid-nuptial agreement to protect their business, a mid-nuptial agreement can also be used to protect the non-business-owning spouse. If an investment or business is risky, the debts incurred would also become part of the marital estate. If the non-business-owning spouse wants to ensure that those debts never become their problem, a mid-nuptial agreement is one way to do that.
It’s important to note that, much like prenuptial agreements, mid-nuptial agreements can never involve provisions regarding custody of the children or child support payments. These provisions are overseen by the courts and determined in accordance with the best interests of the children—not what the spouses want.
The bottom line
Mid-nuptial agreements are a powerful tool that spouses can use to protect their interests. While it’s not necessarily the most romantic gesture in the world, it is practical in a variety of ways and can work to the benefit of both spouses.
Talk to a Philadelphia Divorce Lawyer Today
The Law Offices of Lauren H. Kane can help you and your spouse create a mid-nuptial agreement. We will help you draft the document and ensure that your interests are protected. Call our Philadelphia family lawyers today to schedule an appointment, and we can begin discussing your needs immediately.