Prenuptial agreements have become increasingly popular over the years, even for couples that are marrying and do not have a high-net-worth. But, before you make the decision to put a prenuptial agreement in place, it’s crucial to be aware of what exactly they are and the details surrounding it, including if they are legally binding.
Not many people realise that a prenuptial agreement is, in fact, not a legally binding document in England and Wales and doesn’t have to be accepted by the courts during a divorce. However, while prenuptial agreements are not legally binding, the courts do tend to take the agreement into account if certain criteria was fulfilled when the agreement was originally created.
A prenuptial agreement isn’t only for wealthy marrying couples. They are beneficial to any couple, providing protection over valuable assets. Here we will discuss the matters surrounding prenuptial agreements, including what a prenuptial agreement is, what criteria the courts look for and what should be included in a prenuptial agreement.
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What is a prenuptial agreement?
A prenuptial agreement or sometimes known better as a ‘prenup’, is a formal document drawn up by couples before they marry or otherwise recognised as a contract between the parties.
The document sets out each party’s individual and shared assets and debts and how these will be divided in the event of a divorce. Other aspects such as marriage roles may also be set out in the document.
A prenuptial agreement is there to protect each party in the marriage and helps to prevent any financial settlement disputes during divorce.
There is an alternative document to a prenuptial agreement, known as a postnuptial agreement. This is exactly the same as a prenup, except it is made after the marriage ceremony.
What criteria will the court look for when upholding a prenuptial agreement?
As we have mentioned above, prenuptial agreements are not legally binding documents, so for a prenuptial agreement to be upheld by the court, it needs to have been drawn up correctly, and certain criteria must have been met during the creation of the document.
This criteria includes:
- The prenuptial agreement must have been freely entered into by both parties – neither party should have felt pressured to enter into the agreement
- Each party is required to seek their own legal guidance – each party must use different solicitors
- Each party must completely understand what they are entering into, including the implications
- Each party must be open and honest about their finances
- The agreement must be made at least 28 days prior to the marriage ceremony – despite this, it’s recommended to consult a solicitor at least three months prior to the marriage ceremony
- It should not be unfair to either party or any children
- The agreement must have contractual validity
- The agreement must have been executed as a deed
What should be included in a prenuptial agreement?
Prenuptial agreements can include a lot of different issues, and your prenuptial agreement solicitor will provide expert advice on what you should include based on your personal circumstances.
Most usually, the following matters will be included in the prenuptial agreement document:
- Property – each party’s individual property, any joint property
- Money – savings, investments, etc. – both separate or joint
- Debts – individual and shared debts
- Children – their rights to assets
- Inheritance – if one or both parties have inheritance, a prenuptial agreement can protect this
Can a prenuptial agreement be amended?
Even after a prenuptial agreement has been made, it is possible for the document to be amended where needed to be. However, for the modifications to be made, it has to follow the same criteria as to when it was officially made. It is recommended that such amendments be made at milestone events in a marriage, such as the birth of children or significant changes in finances.
Why should you use a solicitor when creating a prenuptial agreement?
There are many different reasons why you should be using a prenuptial agreement solicitor.
To start with, when it comes to the agreement being accepted in court, each party must have pursued legal advice from a solicitor. This means if you choose not to use one, your agreement may not necessarily be upheld in court.
In addition, a solicitor will be able to advise exactly what it is that you should include in the document and assist with the drafting of it, ensuring all potential mistakes are carefully side-stepped.
Contact our prenuptial agreement solicitors in London and St Albans
Get friendly, practical advice about entering into a prenuptial agreement with your prospective partner. We can offer you a free initial telephone consultation to talk about how we can help and to provide a quote.