No one ever wants to think about their divorce in Illinois, but the reality is that it can happen to anyone. If you are a property owner, it is important to take steps to protect your real estate portfolio from divorce. You can start by doing the following.
Buying out your spouse’s interest in the property
If you are the sole owner of a property, then your spouse may not be able to claim an ownership stake in it during a divorce. However, if you own the property jointly with your spouse, then they may be entitled to half of its value. To protect yourself, you can buy out your spouse’s interest in the property before filing for divorce. This way, you can keep the property entirely for yourself.
Putting the property in a trust
This can be a revocable trust, which means that you can still change the terms of the trust or even dissolve it entirely if you want to. Doing this can give you more control over the property during a divorce. For example, you can specify that your spouse cannot sell or borrow against the property without your permission. On the other hand, an irrevocable trust is more permanent and can be a good way to protect your property if you are sure that you want to keep it.
Forming an LLC
If you own rental property, you can form a limited liability company (LLC) to hold the property. This can help to shield your other assets from being divided in a divorce. For example, if your LLC owns a rental property, then your personal assets such as your bank account and your house will not be at risk if the property is sold during a divorce.
Whether or not you are facing the possibility of divorce, then it is important to take steps to protect your real estate portfolio. This is especially true if you own joint property with your spouse or if you have significant assets. By taking the time to do this now, you can save yourself a lot of stress in the future.