Creating a Marital Settlement Agreement in a Divorce


Many couples who decide to get a divorce agree on a lot of the issues that have to be dealt with. For example, both may agree that the children should spend most of the time with one parent. Both may agree on who gets what property. Both may want to make sure their own wishes about important matters are respected.

When a couple can come to an agreement about the issues in their divorce, they need to formalize it. “Formalizing” is not a difficult or mysterious process. The term just means that the agreement is put into writing, and turned into a final document. This final document is known as a “marital settlement agreement.”

Putting your verbal agreement into writing accomplishes three things. First, it makes sure that both spouses know exactly what they are agreeing to. Misunderstandings can be avoided when everything is made clear. Second, it lets the court know what your agreement is. The courts encourage couples to work out as many issues as they can between themselves. As a general rule, courts will approve a settlement as long as it does not appear that one party has taken unfair advantage of the other. There are some limited exceptions to this general rule; for example, parents cannot agree between themselves that child support payments will be less than the amount called for by state guidelines.

Third, you can be sure all of the issues are covered. A common pitfall for couples who draft their own agreements is that an important issue is left out. A marital separation agreement should include the following:

  • Child custody and visitation. An agreement must set out who will have the physical custody of the children. It should also set out how often the other parent will have visitation with the children. While many couples may think a schedule is not needed, making a schedule now will avoid conflicts later.
  • Child support. Your agreement should set out the amount of support that will be paid. It should also show how that amount was arrived at, by setting out each parent’s income, medical and dental insurance premium, child care expenses, and any extraordinary expenses. This will let the court know that your agreement calls for the correct amount of support. You cannot agree that child support will be less than the amount called for by New Mexico support guidelines (see our article How to Calculate Child Support).
  • Spousal support (Alimony). Will one spouse receive support payments from the other? If so, how much? How long will payments be made? Will they end when the spouse receiving payments remarries? If support is not going to be paid, are both spouses clear that they are giving up any claim to it? When determining spousal support, it is important to consider the questions of for how much and for how long will the spousal support be paid. Without clarifying this in your settlement agreement, you or your spouse may receive more (or less) spousal support than is considered fair.
  • Property division. This is the part of the agreement that can get the most complex. An agreement should say, at the very least, who will get particular items of property that are titled or licensed. For example, if a couple owns real estate, the county property records will need to show that one spouse is no longer an owner. The agreement will require that spouse to let his or her name be taken off the property records. Similarly, names on motor vehicle titles and bank accounts will have to be changed. An agreement will make sure that this will be done.
  •  Debt Division. Debt division refers to the division of all debt incurred during the marriage. This will include any credit card debts, mortgages, and other outstanding bills. Typically, courts will attempt to divide debt in a fair and equitable way, regardless of whose name the debt is held in. This means that even though a credit card only has one spouse’s name attached to it, the court may divide any debt owed on that card between both parties.

It may not be necessary to list everything you own in a settlement agreement. An agreement could just say that all of the property has been divided to the parties’ mutual satisfaction, if that is the case. That being said, where a specific action is required of either you or your spouse, it should be specified in your settlement agreement. For example, if dividing property calls for someone to do something, such as sign over title, or even deliver an item to a former spouse’s new home, it should be included in the agreement. Even if one spouse is keeping the entire piece of property, it must be listed in the agreement. For example, even if your spouse is keeping his or her a retirement account listed in his or her name, this must be listed in the agreement.

It is always best when a couple can reach an agreement on their own. It will save time and money. It will also help the process go more smoothly for both of you. If you find you are struggling to reach a compromise, consider scheduling a mediation.

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