Ending a marriage is a complicated process.
It not only involves the termination of an important personal relationship. It also requires couples to contend with a host of related and complex issues.
For instance, a couple will only be able to obtain a divorce after they have decided how their marital assets will be divided. This applies to all of a couple’s marital property,
- All personal possessions,
- Real estate and,
- Joint bank accounts.
When it comes to the latter, courts allow both parties to use joint funds to pay for reasonable expenses and costs, such as mortgage payments and childcare costs.
If, however, there is evidence that one spouse is attempting to waste or hide assets, a judge could step in and freeze all of the assets in the account, as well as any other marital property that is at risk.
A couple’s assets could even be frozen from the outset of divorce even if there is no evidence of wrongdoing.
To learn more about freezing assets during divorce and protecting your own marital property, please contact an experienced property division lawyer.
How Do Courts Freeze Assets?
Courts have the discretion to freeze a couple’s assets during divorce proceedings through the issuance of a court order specifically forbidding the parties from selling, wasting, or even accessing certain assets.
In many cases, courts will take this step early in the proceedings. In actuality, it is even possible to request a temporary restraining order that freezes the parties’ assets when initially filing a divorce petition.
In these situations, the temporary restraining order will usually go into effect immediately and last for at least two weeks.
Texas residents who live in certain counties may not be required to request a restraining order. Some areas, including Travis County, issue standard restraining orders automatically upon filing for divorce. Known as standing injunctive orders, these types of restraining orders apply in every divorce case filed in Travis County, regardless of whether a party requested it.
Upon filing, a copy of the standing order is attached to the original petition and goes into effect immediately, unless modified by the court.
Please contact our legal team today for help determining whether your own county courts use standard restraining orders.
What Does it Mean for Assets to be Frozen?
Under the terms of standard temporary restraining orders, both spouses are barred from modifying their financial situation in any substantive way.
This means that as long as the temporary restraining order is in place, neither party is able to:
- Sell, borrow against, or transfer their marital assets;
- Change the beneficiaries on any of the couple’s insurance policies, bank accounts, or estate planning documents;
- Incur new debts; or
- Divest themselves of any joint assets.
It’s also important to remember that just because a court temporarily freezes a couple’s assets, including any joint bank accounts, does not mean that the spouses will not be able to dip into those accounts to pay for living expenses, such as food, shelter, clothing, medical care, transportation, and reasonable attorneys’ fees.
If there are concerns about what qualifies as a reasonable expense, the parties can always ask the court for clarification.
Is Freezing Assets Beneficial to Divorce?
Although freezing a couple’s assets may seem like an extreme measure, the reality is that taking this step can help streamline the property division process and save time later by ensuring that all marital property is easily identifiable.
This true even when there is no fear that one of the parties will waste or attempt to hide an asset through transfer, sale, or overspending.
Freezing assets can also make it easier to track down marital assets, as it essentially provides the parties, their attorneys, and their divorce teams with a snapshot of the couple’s financial situation at the time of the filing.
This information can then be used to ensure that any property agreements reached by the parties are fair to both individuals.
Can My Assets be Unfrozen?
Although some restraining orders remain in place through the entirety of divorce proceedings, this is not always true.
In reality, temporary restraining orders can be modified if both parties agree to the change and the modification receives approval from the court.
In most cases, these modifications are driven by an inability to meet reasonable expenses, such as rent payments or transportation costs.
Call Today for Help with Your Divorce
If your assets have been frozen, or you are concerned that your spouse may be wasting marital assets, please call dedicated divorce attorney Ben Carrasco at the Law Office of Ben Carrasco, PLLC at (512) 320-9126 today.