In the state of Illinois, any property held inside of a marital estate may be divided in a final divorce settlement. This means that any rental properties, commercial holdings or lots of land that you own could be ceded to your spouse. However, it may be possible to protect your real estate portfolio from being taken after your marriage comes to an end.
Hold real property outside of the marital estate
Perhaps the easiest way to protect your real estate holdings in a divorce is to hold them outside of the marital estate. This may be done by titling your portfolio in the name of a trust or LLC. If you acquired homes, land or other real property prior to your marriage, it’s possible that it will be considered sole property. This would mean that it wouldn’t be subject to state property division laws.
Your spouse may not want your properties
There is a chance your spouse won’t even want a portion of a multifamily home, office building or other portions of your portfolio. This may be because he or she doesn’t believe that they are worth enough to fight for. It may also be because the time and effort it would take to maintain those properties is not worth the potential long-term financial reward.
Include real estate holdings in a prenuptial agreement
If you want to keep a property in your name after a divorce is finalized, it may be a good idea to include it in a prenuptial agreement. Alternatively, you can include it in a postnuptial agreement if you don’t have time to properly execute a contract before your wedding day.
It’s not uncommon for a divorce to have a significant impact on a person’s finances. However, there are steps that you can take before or during the divorce process to minimize the financial damage that ending your marriage might cause. In addition to retaining control of marital property, you may be entitled to alimony or child support payments as part of a final settlement.