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Rockford Divorce Lawyer James Teeter

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How are Vacation Homes Divided in a Divorce?

From beach-front cottages to cabins in the woods, many married couples invest in vacation properties to add to their quality of life. Unfortunately, when some of these couples later face divorce, a once joyous retreat can quickly become the subject of a significant battle for ownership rights.  If you have a vacation property and are going through a divorce, a vacation property divorce lawyer can help.

For years, I have helped clients successfully navigate divorce and complicated asset divisions, including those involving vacation homes, businesses, and other valuable real estate. If you are contemplating divorce or have been served with divorce papers and are concerned about protecting a vacation home or rental, I invite you to call my office to schedule a complimentary consultation to learn how I can zealously advocate for your rights and property. I also encourage you to read the following FAQs to learn more about the division of vacation homes during divorces.

How Are Assets and Debts Divided in Illinois?

Section 5/503 of the Illinois Marriage and Dissolution of Marriage Act (the “Illinois Divorce Act”) governs the distribution of property. Illinois is a “No Fault” divorce state, which means marital misconduct (such as adultery or other misconduct) is not factored into the equitable division of marital property.

Under the Illinois Divorce Act, the Court is to assign to each spouse that spouse’s Non-Marital Property, and to “equitably” or “justly” divide the property and debt which comprises the Marital Estate.

The terms “equitably” and “justly” do not mean that marital property is to be divided on an equal basis. In most long-term marriages, the division of property often favors the spouse with less income potential and fewer career opportunities.  Thus, in a marriage that has lasted for 25 years, if one spouse has been a stay-at-home parent with limited earning potential while the other spouse earned significant income, the stay-at-home parent with the limited earning potential is likely to be awarded more than the high-income spouse.

Vacation Properties FAQs

Not necessarily.

Asset division is case-specific, and how a vacation home is legally classified will generally determine whether it will be affected by a divorce. It is critical to first determine whether a vacation property is a marital asset (in which case the home would be subject to property division) or separate property (in which case the home would not be subject to division).

For example, if a vacation home was left to one spouse through inheritance, Illinois law may treat the home as “non-marital property; thus, it would not be subject to division. However, if the property was purchased during the marriage, or if marital assets were used to maintain or improve the property, a court may find that such property became a marital asset.

In many cases, a number of factors will need to be considered to determine whether a vacation property is or is not a marital asset.

It is critical to note that when a divorce arises, the parties maintain a right to reach critical decisions about property and asset division without the intervention of a court. Thus, if a vacation home is marital property and the ex-spouses are amicable, it may be possible to negotiate terms in which one spouse retains the vacation property in exchange for other assets. However, if an agreement cannot be reached, a judge will determine how assets will be divided among the parties, considering factors including (but not limited to):

  • The financial needs and obligations of the parties;
  • The separate property of each spouse;
  • The length of a marriage;
  • The parties’ conduct during the marriage (including economic misconduct);
  • The income of each party;
  • Each parent’s age and health; and
  • Future employability.

There are three common options for dealing with vacation homes in a divorce (assuming that the property is a marital asset):

  1. Sell the Vacation Home. While selling a property may appear to be an expeditious and simple resolution, the economy, upside-down mortgages, and emotional attachment can make selling a home more challenging than it might at first seem.
  2. Timeshare. In situations where ex-spouses remain on good terms, the parties may wish to share a vacation property, allocating certain dates to each individual. In these instances, a separate entity (like a limited liability company) can be created to hold legal title to the property, and an operating agreement can be developed which specifies all of the terms and conditions relating the property.  The property can also be rented out and a management company can be retained to manage the property, if desired.
  3. Assign Ownership to One Spouse. If one spouse is interested in retaining the vacation property, ownership of the vacation property can be assigned to one of the spouses. If this is the case and there is equity in the vacation home, then the spouse not receiving the vacation home may be “bought out” by the other spouse, often through a greater share of other marital assets, an assumption of more debt by the spouse receiving the vacation home, or through future payments by the spouse receiving the vacation home to the other spouse.

How Can I Help with Your Vacation Property Concerns?

If you are going through a divorce and are concerned about a vacation property, I invite you to call my office to schedule a free consultation. As an experienced Rockford divorce and property division lawyer, I can listen to the facts of your case, review potential tax consequences, discuss your legal options, and tenaciously fight for the maximum to which you are rightfully entitled.

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Attorney James O. Teeter, Jr. speaking with client. Attorney James O. Teeter, Jr. speaking with client.

Family Law Attorney James O. Teeter Jr.
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Submission of information through the contact form does not create an attorney-client relationship, so please do not submit any confidential information. If we are to serve as your attorneys, all fees and the nature of our representation will be set forth in a written agreement.