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Premarital Agreements

Premarital agreements, also called prenuptial or antenuptial agreements, are contracts between two people who intend to marry each other. These agreements usually address issues relating to the parties' property and income during the marriage, after the marriage if it ends in divorce, and after the death of one or both spouses. Premarital agreements can also address nonfinancial issues, such as the religious upbringing of the parties' children. The issue of child support in the event of the parties' divorce cannot, however, be resolved by a premarital agreement. Also, a court generally will not enforce insignificant nonfinancial details in a premarital agreement, such as who will clean the bathroom.

Premarital agreements are used most often by couples who are marrying for the second or subsequent time, or when one person brings significantly greater financial assets to the marriage. Often, a premarital agreement is used as a vehicle by which the spouses can ensure that their children from a previous marriage receive a substantial portion of their assets upon their death or divorce.

A premarital agreement may be unenforceable or voidable if either party has withheld important financial information or coerced the other party to sign it, or if the terms are so unfair that, if enforced, one party would be left with very little. Before entering into the agreement, both parties must fully disclose their assets, income, and liabilities to the other, and they must enter into the agreement in good faith. In order to ensure that a premarital agreement will be enforced, it is advisable for both future spouses to be represented by separate counsel, who can advise them on their rights and responsibilities. In fact, some states' laws require that each party be represented by a separate attorney in order for a premarital agreement to be valid.

Each state's statutes on premarital agreements vary slightly, although many states have adopted a version of the Uniform Pre-Marital Agreement Act. It is important when entering into a premarital agreement to make sure that the contract terms comply with the applicable statutes. A lawyer can help in that regard. If the agreement is in compliance, it will be enforceable and, if contested by one spouse, upheld by the court. Courts will not uphold premarital agreements, however, if they violate a public policy, such as by promoting divorce. If, for instance, an agreement provides that one spouse will receive much better financial treatment after divorce than he or she does during the marriage, the court may determine that the agreement encourages divorce and contravenes the public policy that favors marriage, and therefore refuse to enforce the agreement's terms.

Premarital agreements differ from separation agreements, which are entered into after marriage and set forth the terms that apply, as the name suggests, to the parties' separation. Whereas separation agreements are often entered into in contemplation of divorce, premarital agreements are entered into in contemplation of marriage. The court in some cases will enforce post-marital, or postnuptial, agreements, which are usually subject to many of the same requirements as premarital agreements.

Checklist: Prenuptial Agreements Terms

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Prenuptial Agreements Terms

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