Tuesday, January 13, 2009

The New Economy and Divorces

Another example where Indiana, and especially the Anderson area, has a led on the rest of the country: In Housing Fall, Breaking Up Is Harder to Do. The New York Times reports a problem we have had here for a while and I expect to persist.

Chalk up another victim for the crashing real estate market: the easy divorce.

With nearly one in six homes worth less than the mortgage owed on it, according to Moody’s Economy.com, divorce lawyers and financial advisers around the country say the logistics of divorce have been turned around. “We used to fight about who gets to keep the house,” said Gary Nickelson, president of the American Academy of Matrimonial Lawyers. “Now we fight about who gets stuck with the dead cow.”

As a result, divorce has become more complicated and often more expensive, with lower prospects for money on the other side. Some divorce lawyers say that business has slowed or that clients are deciding to stay together because there are no assets left to help them start over.
I can say that there is no easy solution to this problem. One current case has several upside down properties. That has been the easiest case - the client is judgment proof.

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