Can You Sell Assets before Your Divorce Is Final?

Getting a divorce raises countless questions, including how to divide a couple’s assets. In a divorce, there is marital property – property subject to division – and separate property – personal property you own individually that's not subject to division. When divorce is imminent, some people try to scoop up as many assets as possible, an act that isn't usually allowed.

What assets do most couples share?

Most divorcing couples have assets that they share such as real estate, cars, and bank accounts. Real estate might include a house, vacation home, rental property, or other properties. If the couple jointly owns one or more vehicles, those will likely need to be split. Bank accounts to be split include joint checking and savings accounts from which both parties could access funds when they were a married couple.

Further, married couples may share investment portfolios including stocks and bonds, retirement accounts such as 401Ks or IRAs, mutual funds, and other investments. Life insurance policies are typically shared assets that need to be split between the two parties when they get divorced. There are other intangible assets to consider as well, such as profit-sharing endeavors and cryptocurrency.

Read: What Happens to Crypto Assets in Divorce?

Before a divorce can be finalized, all of these assets must be accounted for so there can be an equal division between spouses according to state laws and court orders.

Can I sell my marital home before the divorce is final?

Generally, you cannot sell your marital home before your divorce is final without permission from the court. Selling property before a divorce is finalized can complicate matters and impede negotiations during the divorce process. It may even go against the divorce laws of your state.

However, if you and your soon-to-be ex-spouse agree to sell the family home, you may be able to do so before you get your final divorce papers. You'll need to keep a clear accounting of the proceeds of the sale, as that money will be subject to distribution between you. In some cases, you may be able to use some of the proceeds to provide necessary spousal support for living expenses, but you'd need to keep detailed records of that, too.

Can I refinance my house before the divorce is final?

Typically, you cannot refinance your home before you get your final divorce decree. Refinancing under your name only requires you to know your post-divorce income and prove that, with documentation, to the bank. You won't have that information yet, so a bank is unlikely to greenlight a refinance. 

That said, you can start searching for the best refinancing rates now – though you won't be able to complete the refinancing process until after your divorce.

Note: If you plan to keep the marital home after your divorce and it is currently titled in both your names, you will likely need to refinance when changing ownership. This is why it's a good idea to begin your refinance search now. The more knowledge you have ahead of time, the faster you may be able to move through the refinancing process once your divorce is complete.

Can I transfer property before my divorce to protect it?

No, and doing so could get you into serious trouble with the court, as it could be viewed as an attempt to withhold assets from your spouse. Transferring property before your divorce is finalized could even result in legal action being taken against you. 

If you transfer any of your marital assets before your divorce is finalized, the court may consider these assets when determining who gets what in terms of property and debt division.

However, if one spouse does not have sufficient funds for living expenses during the divorce period, they may be able to transfer or sell assets prior to the divorce in order to cover these expenses. This usually requires permission from both parties or a court order.

What if I suspect my spouse is hiding assets?

If you suspect your spouse is hiding assets, it is important to take action right away. Alert your attorney and any financial experts involved in your divorce case. Your lawyers can help you investigate whether any assets have been hidden, and they may be able to access records and documents that would help give you a better idea of the total value of your community property.

Read: Suspect Your Spouse Is Hiding Assets During Divorce?

In some cases, your lawyer may need to talk to your spouse's accountant or other financial advisors in order to uncover any hidden assets. If this is necessary, the court may issue a subpoena obligating the other party to turn over all relevant records and documents related to their finances. 

Additionally, if you believe someone who knows about the assets is lying during a deposition or refusing to cooperate, your attorney can file a motion to compel the person's compliance with the court orders.

Your attorney can also work with a private investigator if needed. Private asset investigators are trained in researching financial information and uncovering hidden assets by examining public records, bank statements, paperwork, tax returns, and other sources of information related to your spouse’s finances.

Can I sell assets before filing for divorce in order to reduce the asset pool?

No. The court views any reduction of the asset pool as suspicious and may consider it when deciding how to divide the remaining assets between divorcing spouses.

There are, however, certain exceptions that would allow spouses to sell assets before their divorce is finalized. These are usually limited to situations where there is a need for money to meet necessary living expenses or pay off debts incurred during the marriage. If one spouse wants to sell an asset but their partner objects, they may need to go through the court system for permission first. 

Additionally, if the court orders a certain asset to be sold in order to pay off marital debts, this sale would have preference over any other considerations related to the divorce process.

Financial issues in divorce are complex and often confounding. At Hello Divorce, we offer online divorce plans to help simplify the process as well as legal advice and financial planning assistance that can help you foster a fair division of property and other assets.

Want to sell your ring or other personal property after your divorce? Evaluate their cash worth.
Divorce Content Specialist & Lawyer
Divorce Strategy, Divorce Process, Legal Insights

Bryan is a non-practicing lawyer, HR consultant, and legal content writer. With nearly 20 years of experience in the legal field, he has a deep understanding of family and employment laws. His goal is to provide readers with clear and accessible information about the law, and to help people succeed by providing them with the knowledge and tools they need to navigate the legal landscape. Bryan lives in Orlando, Florida.