Does Divorce Deal with Property Settlement? What you need to know
Many people believe that once their divorce is final, everything has been legally sorted.
It's one of the most common misconceptions we see.
While a divorce legally ends your marriage, it doesn't automatically resolve your financial relationship with your former spouse. That means important matters such as your home, savings, superannuation and other assets may still need to be formally addressed.
Understanding the difference between divorce and property settlement can help you avoid costly mistakes and give you greater certainty about your future.
For more guidance on separation and family law matters, explore Brite Legal's Family Law services.
What You Need to Know About Divorce and Property Settlement
1. Divorce and Property Settlement Are Two Different Legal Processes
One of the biggest misunderstandings is thinking that divorce automatically divides your assets.
It doesn't.
A divorce legally ends your marriage.
A property settlement determines how your finances, assets and liabilities are divided after separation.
Although they're connected, they're separate legal processes.
2. You Don't Have to Be Divorced to Finalise Your Property Settlement
This surprises many people.
In fact, many separating couples resolve their financial matters before applying for divorce.
Some people also choose not to divorce immediately for personal, financial or religious reasons, but they can still negotiate and formalise their property settlement.
For de facto couples, divorce isn't part of the process at all, but property settlement rights can still apply.
3. A Divorce Doesn't Automatically Protect Your Future Assets
Receiving your divorce certificate doesn't necessarily mean future financial claims have ended.
If your property settlement hasn't been legally finalised, there may still be circumstances where financial issues remain unresolved.
Depending on your individual circumstances, this could affect assets you acquire after separation, including:
purchasing another home
increasing your savings
building your superannuation
investments
starting a business.
This is one reason why obtaining legal advice early is important.
4. Property Settlements Need to Be Properly Formalised
Many couples reach an agreement between themselves.
While this can be a positive first step, simply agreeing isn't always enough.
To provide legal certainty, property settlements are commonly formalised through:
Consent Orders
Binding Financial Agreements (where appropriate).
The most suitable option depends on your individual circumstances.
5. There Are Important Time Limits
This is one of the most important things separating couples should understand.
If you were married, you generally have 12 months from the date your divorce becomes final to apply to the Court for a property settlement.
If this time passes, obtaining permission to proceed can become more difficult.
Different time limits apply to de facto relationships.
6. Going to Court Isn't Usually the First Step
Many people assume property settlement means lengthy court proceedings.
Fortunately, that's often not the case.
Many family law matters are resolved through:
negotiation
mediation
solicitor-assisted discussions
Consent Orders.
Court is generally considered a last resort when agreement cannot be reached.
Common Questions We Hear
"We've already agreed who gets what."
That's a great starting point, but depending on your circumstances, it may still be important to have your agreement legally documented.
"We've been separated for years."
Time doesn't automatically finalise a property settlement.
If financial matters haven't been formally resolved, it's worth seeking legal advice about your position.
"We've already divorced."
If your property settlement hasn't been legally completed, there may still be important steps to take.
Speak With Our Family Law Team
If you're separating, recently divorced or simply unsure whether your financial arrangements have been properly finalised, our Family Law team can help you understand your options.
Book an appointment with Brite Legal to discuss your circumstances and see what action needs to be taken.
Written by Brite Legal
Reviewed by Grace Chay, Solicitor
Grace is a solicitor at Brite Legal, assisting clients with family law, property settlement and mediation matters across South Australia. This article has been legally reviewed to help ensure the information is accurate and up to date at the time of publication.