Carol Ann's Newsletter
October 2015
Table of Contents
1.  Rebuttal to Reverse Mortgages article in last month's newsletter
2.  13 Mistakes Even Smart People Make
3.   From a Lawyer's Point of View
4.   From the desk of Carol Ann
5.   Humor
6. Thought for the Day

1.  Rebuttal to Reverse Mortgages article in last month's newsletter

Last month, I wrote about Reverse Mortgages.  Mark Minchew ( responded with the following:
Carol Ann,

     I have appreciated your knowledge and wisdom through my studies with you as a Divorce Specialist.  However, your information about the Reverse Mortgage has errors in it.  
     Now, as of about six months ago, they do have to qualify for the Reverse Mortgage.  Furthermore, it should be noted that the owner still has to pay the taxes and insurance on the home.  Also, accruing in the background is a huge PMI payment that the government applied even thought there is a required 50% equity, so the government can make up for the debacle of the downfall in 2008.  It never goes away.

     I think it should also be mentioned that they cannot vacate the home or change their primary residence for more than six months.  So if the home is not being lived in the creditor can require the home to be paid off.  (think assisted living)
Regardless of all I have said, it is still a good alternative vehicle for older people and divorcees, but the other concerns should be mentioned.

Mark Minchew, CRS, CRB, CIPS
To look at past newsletters, g o to: and click on Newsletters.
2.  13 Mistakes Even Smart People Make
1.  Signing papers without understanding what they mean.
2.  Canceling or changing insurance policies without thinking though the consequences.
3.  Withholding information fro their lawyers because they now think what they did or said might have been a big mistake.
4.  Going into denial about the process, withdrawing, or taking it too lightly.
5.  Forgetting about the tax consequences of certain matters in the divorce.
6.  Relying more on the advice of family and friends than on their lawyers.
7.  Not having enough life and disability insurance to protect an income stream they will depend on.
8.  Waiting too long to take action to enforce child and spousal support that has stopped.
9.  Not seeking the advice of psychological and financial professionals.
10.  Not planning far enough ahead for health coverage after the divorce.
11.  Thinking that all participants are "fair."
12.  Dumping the case in the lawyer's lap and expecting good results.
13.  Letting emotions run away from the facts

3. From a Lawyer's Point of View 

A lawyer who was trying to weigh the pros and cons of modifiable vs. non-modifiable maintenance for her client stated that within two to five years, ALL of her modifiable maintenance cases were back in court to request modification of maintenance or termination of maintenance.  Makes you wonder, huh

4. From the Desk of Carol Ann

      This month I would like to address the pro-se client.  Pro-se means "without legal representation."  It is the divorcing couple that wants to do their own divorce and save money by not hiring lawyers.  They come to you, the Financial Divorce Specialists, and ask you to help them put together their settlement by showing them the financial result of that they consider to be an equitable settlement.

     This is a dangerous spot for you to be in.  First of all, for you to be talking to both husband and wife means you are in a mediative situation and you cannot advise either of them as a mediator - you may only help them reach an agreement.  Some mediators say you may not even give them information - only help them reach an agreement.  If you are working with only one of the parties, you may give financial information, run reports and show them the financial result of their proposal.  But in this case, who is giving the other spouse information?

     It is imperative for you to suggest that they seek legal counsel.  Even if each only spends one hour with each of their lawyers, they will hear about their legal rights and if there is a possible legal problem , that will be pointed out to them.  You can give your client names of lawyers for them to choose from.

     Actual case:  Robert and Anne felt they had a very simple situation and they did not want to spend money on a lawyer so they drafted their own agreement, filed it with the court and were divorced "pro-se."  After the divorce was final, Anne brought the agreement to me to look over.  They had decided that they wanted to divide all their assets in half (they did not own a house) so that is what they put into their agreement.  
     The wording was, "The savings account, mutual fund and 401k will be divided.  A QDRO will be prepared."  Well, what did that mean?  Anne told me she had never received any money from Robert's 401k.  I told her she probably never would.  Their agreement said nothing about whose 401k it was, who was going to prepare the QDRO, what the QDRO was going to divide or what the purpose of the QDRO was.  So she could not hold Robert in contempt because he hadn't really violated the terms of their agreement.

Even though Robert and Anne had come to an agreement about how to divide their property, a lawyer should have been consulted to draw up the legal document.  You can use this story to illustrate to clients the importance of consulting a lawyer.

5. Humor

A woman sits down next to an attractive man on a bus. 
She says, "You look just like my 4th husband."
The man replies, "Your FOURTH husband!  How many times have you been married?"
"Three" the woman replies.

6. Thought for the day 

Helping others make money and helping other people to fulfill their desires is a sure way to ensure you'll make money for yourself as well as more easily fulfill your own dreams.
 -  Deepok Chopra


Carol Ann Wilson
Carol Ann Wilson LLC