Recession Forces Divorced Back to Court to Lower Alimony, Child Support

When John and his wife divorced, they agreed to sell their home. But every time they come close, his ex stalls because she wants to buy it. With the real estate market in a tailspin and the nation in a recession, She feels prices will go down further, which would enable her to buy it from him at a cheaper price.

To complicate matters, John, not his real name, recently lost his job in the financial industry. With the house issue looming, he’s already asked the court in his state to award him attorney’s fees since his wife filed for divorce. In addition, he’s considering a change to his property settlement: he may return to court to ask his ex for alimony, something he never would have done before the layoff.

According to legal experts from around the country, John’s tale isn’t unusual. The recession that’s affected every other aspect of America is now affecting family court as well. Clients are returning to court as a way to deal with financial hardships that are affecting their property settlement agreements.

“It’s happening because retirement accounts have dwindled to nothing for some people and a decree that gives you half of what was a robust account now gives you half of not much,” said retired attorney Brette Sember, author of a number of how-to books, including “The Divorce Organizer.”

Los Angeles, California family law attorney Kelly Chang Rickert said her clients want to modify their judgments because their financial circumstances have changed dramatically. “Due to the economy and loss of jobs, I am seeing a lot more modifications to child support, reductions for the payor if they’re laid off and an increase for the recipient if they’re laid off.”

“Another big recession issue: Alimony needs to be increased for folks who have lost jobs,” Sember said. In some cases, Chang Rickert says she’s “even seeing changes in child custody arrangements because parents who have been laid off have more time to spend with children.”

A new mom herself, Chang Rickert has noticed nannies and housekeepers are getting laid off because parents who have no jobs have more time to spend at home.

California family law attorney David Pisarra said he’s seen so many clients dealing with this issue that he’s rolled out a new payment program, charging only a flat fee, to address this new need.

John’s not the only one in a quandary over the inability to sell his marital home. “Many property settlements state that the divorcing couple will sell their home, but many people can’t sell and need to know what to do if they can’t,” she said.