What should I know about Binding Financial Agreements?

Under the Family Law Act 1975, it is possible for couples in a relationship to obtain a Binding Financial Agreement. These are commonly known as “prenuptial agreements” although they are not only used by couples who are planning to marry, but also by de facto and married couples.

A Binding Financial Agreement provides for the division of property in the event that the couple later separates. The agreement does not have to be a fair agreement in the eyes of the law. That means the agreement can provide for one person to keep all, or most, of the property.

There are numerous and complex strict legal requirements that apply in order for a Binding Financial Agreement to be legally binding. Careful legal drafting is required. A home-made document will definitely not be sufficient.

Key legal requirements include that each party must have obtained independent legal advice about the agreement and each party’s lawyer must sign a statement confirming the provision of that advice.

Why would I need a Binding Financial Agreement?

If you are about to marry or enter into a de facto relationship a Binding Financial Agreement may be optimal for you if you do not want to leave it to the courts to determine how your property will be divided between you and your spouse/partner if you separate in the future.

Binding Financial Agreements can set out how such matters will be resolved and take away the right of each party to apply to the courts for a financial settlement.

You may have children from a previous relationship and want to ensure that your property interests are not going to be affected as you enter into another relationship.

You may wish to have some certainty about what will happen if the relationship ends. There are many valid reasons as to why you may want to pursue a Binding Financial Agreement and Grope Hamilton Lawyers can assist you in navigating this process.