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Written by
Noel Cookman

What Is An Assessment in a Divorce Settlement?

Published On 
February 4, 2015

One of the greatest values you can give your divorcing clients is a set of tools to implement their settlement and agreements.

Think of it this way – if your client (or opposing) is ordered to refinance the recently-awarded marital residence and include a buyout to their former spouse, how beneficial would it be if everyone in the process (clients, attorneys, the court/mediator, children) knew, in advance, that this would actually happen? What if you knew – BEFORE FINAL DIVORCE – that they could actually turn white paper (decree) into green money (buyouts, payoffs)?

Well, there’s a way to achieve that. That’s what my Assessment tells you.

In as concise a form as possible – usually less than two pages – my Assessment

1.       analyzes the situation,
2.       offers brief explanations of how mortgage finance affects the settlement (and vice versa) and
3.       makes clear recommendations for decree language and settlements.

As a note to #3, I adhere to the principle of non-interference. That is, I do not see my role as trying to affect terms of the settlement. I strongly believe that this is between the parties and their attorneys. My concern is to accommodate, as much as possible, the agreements that are contemplated. However, certain features of a settlement will either allow or disallow loan approval. Therefore, some tweaking is sometimes called for.

Here’s an example. A wife wishes to be awarded the marital residence under the proviso that she refinance its mortgage and, thus, relieve the husband of its credit liability. She needs support income to qualify for this mortgage. The wife tells me that spousal support is contemplated at $2,000 per month for two years. Well, one of the mortgage rules is that such income must continue for 3 or more years after loan closing. So I ask, “can you live with $1,333 per month for 3 years?” If so, all $1,333/month is qualifying income while $0 of the $2,000/month could be counted as her qualifying income (because it does not extend for 3 years or more after loan closing). There are usually a few other adjustments to be made but that’s the general idea.

Thus, I have not affected the actual dollar amount that is to be paid/received; I have simply recommended that it be structured in such a way as to allow the client to get financing. And, incidentally, the payer benefits as well when he needs financing – instead of $2,000/month counting againsthis debt ratio, now only $1,333 counts against it. It’s almost always a win-win.

Also, I have to advise regarding (what I call) limits to financing. That is, while I never tell a party “you should get this much or they should pay this much,” I do have to say one of two things

-          “It will take this many dollars to qualify” or
-          “For that amount of support, your loan amount cannot exceed $X.”

This is all in a concise Assessment. And by the way, the Assessment is as fluid as a divorce settlement process is. That is, it requires updating and refinement. This is because everything about a divorce settlement affects loan approval. That means I have to update the Assessment.

Here’s how you get my dynamic, award-winning, stupendous (well, pretty important anyway) Assessmentfor your case: Tell your client to call me. Or ask opposing to have their client call me. The one who needs financing (whether refinancing or purchasing in the foreseeable future) needs to make that call.

“Hi Noel; my attorney gave me your number” is the beginning of a dramatically and substantially better settlement with the advantage of my Assessment about


Noel Cookman


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