Tuesday, March 25, 2008

Divorce, The New Economy, and Houses

Reading Credit Crunch Raises New Issues for Divorce Lawyers I was left thinking that California has finally caught up with Indiana. The Anderson housing market has been terrible for years and too often my advice has been to sell the marital home.

The weakening economy, in turn, has some lawyers and judges in divorce cases grappling with issues they haven't seen in years, if ever. And it's affecting families at all income levels.

"It seems to me that a lot of people have been using their house as a bank," said Barry Goode, a family court judge in Contra Costa County Superior Court.

That was fine when prices were increasing, Goode said. But with prices sliding downward, the judge said he hears about home foreclosures "if not every day, then certainly every week."

Some lawyers are asking the court to take judicial notice of the softening real estate market, said Jeffrey Huffaker, a superior court commissioner.

One way he's responding to the weakening economy: He's become more inclined to force the sale of family property before trial in a divorce case.


For clients who can't afford full representation, Lederman said, he offers help with legal writing and litigation advice. The pay-as-you-go option is known as unbundled services.

"You need to find other ways to deal with the new economy, [and] you've got to do it in a manner that's not going to drive you into bankruptcy," said Lederman, president of the family law section of the Contra Costa County Bar Association.

Well, we can hope not having clients forced into bankruptcy. Too often, there is no choice - too little thought and preparation has been done before the divorce.

The article also makes the point about doing a cost-benefit analysis:

In this real estate market, legal bills can present an issue even for more affluent clients.

Ross, the Walnut Creek lawyer whose client's wife wants to keep the family home, bills $450 an hour. "I'm pushing him to settle, because the real problem is they can't afford to continue to litigate."

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