'Til Debt Do Us Part: The hard costs of divorce

After the wedding bells are rung and the honeymoon is over, the hard truth is 53 percent of all marriages end in divorce.

According to the most recent data available from the Centers for Disease Control and the National Center for Health Statistics, about 877,000 couples made the split in 2011. That’s about 36 divorces or annulments for every 1,000 people in the United States.

The U.S. divorce rate has held steady, fluctuating between 3.5 and 3.6 percent per 1,000 people since 2007, but down from 4 percent at the start of the mellenium. Industry experts peg the wedding business at about $2 billion annually, but the cost of a divorce can add up just as quickly.

News Corp. (Nasdaq: NWSA) CEO Rupert Murdoch famously holds the record for most expensive divorce after his 1999 split from former wife Anna Torv, for which he paid a reported $1.7 billion. Murdoch is an extreme case, but a divorce can be expensive at any level, said J. Matthew Miller , a partner with Baird, Lightner, Millsap & Harpool PC.

“Every divorce is different and every divorce depends on the couple. The more you have, the more you have to loose,” Miller said.

So, how much does the average divorce really cost? Unfortunately, the answer isn’t an easy one.

Filing
“The simplest part of getting divorced is the petition,” said Kim Lowry of the Springfield-based Law Office of Kimberly J. Lowry LLC. “The petition fee in Greene County is $132. If the sheriff’s department has to serve your spouse, that’s another $35.”

Filling fees vary depending on the couple’s county of residence. Nearby Christian County charges $90 to file, for example.

All divorce filings must be filed with the court for a minimum of 30 days before being finalized.
Lawyer
While a simple divorce can be conducted without the aid of a lawyer, add in children, a business or property, and the paperwork and legal jargon begin to mount.

“Attorneys sell time. That’s all we have,” said 31-year family practice veteran Don Harmening of Don Harmening Attorney at Law LLC. “There is a big difference between an uncontested and contested divorce. I can do an uncontested divorce without children for $400 to $500, but a contested divorce is another story.”

Harmening said his office could try a contested divorce without children for $5,000 to $10,000, saying again, it all depends on the time involved.

“Most lawyers charge by the hour,” he said, noting his typical fee is $200 an hour. “The more time I spend in court, for filing a motion or preparing a brief, the more arguing that goes on and the more hours that pass, the more it costs.”

Family law attorney Lowry said she charges about $230 an hour for her services, noting typical lawyer fees start around $150 and go up, with most also requiring a deposit to which the hourly fee is billed and paid from.

“It’s not unusual for a divorce case to reach several thousand,” she said. “It all depends on the attorney’s hourly fees and how long the process takes. The discovery process, including depositions, adds up. In a complicated case with significant assets the fees could cost several thousand dollars and could reach six figures.”
Mediation
To settle disputes in contested divorces, the parties involved can choose to attend mediation. In Greene County, two hours of mediation is required. The parties can agree to attend mediation more than two hours and may engage in mediation prior to their case being filed, Lowry said.

“I try to move my clients toward mediation. The mediator doesn’t decide the case, they just attempt to open up the lines of communication,” Lowry said. “I believe, in the end, mediation can save a couple the cost of going to trial.”

Harmening said court-ordered mediation typically ranges from $200 to $250 an hour; however, attorney-assisted mediation is where the bill can skyrocket.

“Say you are paying $200 an hour for mediation and $200 an hour for each attorney in the room – all of the sudden the parties involved are paying $600 an hour to sit and talk with each other,” he said.
Children
“The dispute over children can be the most expensive part of the divorce process,” Miller said. “Often times, if there is evidence of abuse or neglect, a judge will appoint a guardian ad litem to represent the children.

“Basically, it’s a third attorney who looks out for the best interests of the kids. That’s the cost of a third attorney to the parents, which is usually split 50/50.”

Lowry said attorneys typically charge a reduced fee to serve as a guardian ad litem as a favor to the court.

Harmerning said the bulk of most divorce cases are done in custody and child support work. In Greene County, parents can be ordered to take parental education classes to help their children through issues that arise from the separation.

“A $200 an hour class for five hours means a parent can pay $1,200 just to make headway in a custody battle,” he said. “It’s not uncommon for the bill in a custody battle to reach $25,000 just in lawyers’ fees.”
Business
“Splitting a business isn’t easy,” Miller said. “The value of the business must be determined and then there are a few options. The business can be sold and split 50/50 or the more typical route, one party buys the other out of their stake.”

Miller said a certified valuation analyst must assess the business to determine value.

“My job is to give my professional opinion and determine the fair market value of the business,” said Dee Robinson, a CVA with Robinson & Co. LLP. “This couple needs a real-world feel for what someone would pay for this business.”

Typically taking about six weeks to complete, Robinson said depending on the complexity of the business, fees range from $5,000 to $10,000 for a valuation.
Property
As with any joint obligation, a mortgage loan is granted to the husband and wife based on their joint credit strength and their joint household income to help make the loan strong, said Randall Bettis, senior vice president of BluCurrent Credit Union.

“It is not as easy as abiding by the order from the court stating one spouse will maintain and pay the mortgage without the help from the other spouse,” he said. “The divorce decree is more a matter of a peace agreement for all parties, and does not legally change the contract for the debt.”

Bettis said if one spouse is required to refinance the mortgage out of the former spouse’s name, then that person must reapply with the mortgage holder and the normal real estate processing will begin, including an appraisal costing about $350 to $450. Creating a new mortgage loan on behalf of the spouse would include closing fees of about $2,500 to $3,000, he said.  
Adding it up
So in the end, how much will a divorce cost? Without legal counsel, an uncontested divorce is simply $132 in Greene County. However, Lowry said it’s rarely that simple.

“There are no clear cut-and-dried fees for getting divorced,” Lowry said. “You can’t just say it cost $1,000 to get divorced and be done with it. The variables are too great."[[In-content Ad]]