When a married couple is contemplating a divorce, if there is jointly owned property, an appraisal will almost always be necessary to determine how to divide the assets fairly and equitably when the divorce is final. There are professional appraisers to evaluate property, as well as any and all other types of possessions the couple may own.
The law(s) regarding division of property and assets can be different from state to state. Many people believe that all assets will be equally shared between spouses during a divorce, but in fact, this is not necessarily true. There can be many mitigating circumstances that affect the actual asset division. Some circumstances to be considered include:
Was the property owned by one partner prior to the marriage?
Was the property a gift or inheritance to one spouse during the marriage?
Was the property acquired with funds that one partner brought into the marriage?
Was a pre-nuptial agreement signed prior to the marriage?
How was title taken to the property in question?
Has the asset increased in equity since it was bought? Was the increase due to an equal investment of time and funds by both spouses?
Is the asset part of a business venture owned and operated outside the marriage?
Was the business up and running prior to the marriage?
It is critical to seek legal counsel prior to ordering an appraisal. While some states use the separation date as the appropriate date to determine values for asset division, other states may deem any valuation is premature until closer to the final decree.
Partners should utilize the services of a certified or licensed appraiser. When real estate type of property is to be valued, it is wise to utilize the services of a local appraiser who is familiar with local valuations, assessments, etc. Your attorney or CPA can usually suggest a good appraiser for you.
If there are investment properties and/or commercial real estate involved, you may need to hire more than one appraiser. For assets other than real estate, it is very likely that the services of at least one more appraiser will be required. For example, few appraisers are certified to appraise antiques, artwork, or jewelry.
Surprisingly, it is not unusual for non real estate types of assets to exceed the value of real property, and certainly since the more recent drop in housing values, the amount of equity in real property. When you start to consider automobiles, boats, motorcycles, expensive bicycles, jet skies, snow equipment, business equipment, cameras, motor homes, china, silver, collectibles, jewelry, pensions, and retirement plans, you can see that property division is very important, especially if the marriage has been of long duration.
The Uniform Standards of Professional Appraisal Practice (USPAP) was formally adopted across the United States in 2008. The USPAP established a uniform set of procedures regarding education, testing, licensing and certification for all property appraisers in the country. The USPAP sets the standards for real estate, personal property, business and mass appraisal. Appraisers are still licensed or certified at the state level.
Before you hire any appraiser to assess your property, be sure to request a copy of the state issued license or certificate, and a copy of the E & O insurance, which will protect you in case of errors.
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