We are all living in difficult financial times as a result of the Covid pandemic. Concerns over cash flow and how you could finance divorce proceedings might be stopping you from moving on from an unhappy or unhealthy relationship. Funding a divorce can be particularly difficult if assets are tied up and you don’t have liquid cash to pay for legal services. So, here are some options to consider.

Ask you ex-partner
Joint savings might be held in the name of your ex-partner which you cannot access. You might be the parent who stayed at home to raise the family and you don’t have an income to rely on. One option is to ask your ex-partner to allow you access to savings or income to help fund your representation. If it’s been a difficult break up, your ex is unlikely to agree. It is not uncommon for a party who ‘holds the purse strings’ to use this as leverage to try to secure a more favourable settlement. However, all is not lost. There is always the option of an application to the court explained below.

Help from family and friends
Family or friends might be prepared to provide short term support. To avoid the court treating such funding as “soft loans” i.e. where the repayment is not treated in the same way as borrowing from a bank or credit card company, it is recommended that you enter into formal loan agreement. Beware however, your spouse may try to argue that you have access to resources from friends and family that could support you financially in the long term or to help pay for a new home.

Bank Loan or Credit Card
With interest rates still low, a short term bank loan or taking out a credit card account could be an answer. Interest free borrowing is still available through some credit card companies. Borrowing can be paid off from the sale or liquidation of bigger assets on settlement.

Litigation Loan
Where financial proceedings have been issued, there are specialist commercial organisations who regularly lend to individuals to fund their family law cases with repayment being made upon the conclusion of the proceedings. Such loans are viewed by the family court as ‘hard loans’, i.e. they must be repaid. Interest charges are however higher because of the financial risk that these companies are taking to advance the money up front and delay recovery until a settlement is reached and assets are liquidated.

Apply to the family court for a Legal Services Order
If your ex-partner has control over the cash and will not agree to the release of funds to enable you to access legal services fairly, you can apply to the court for a Legal Services Order which will force your ex-partner to pay you a lump sum or a series of lump sums for use towards representation. Faced with the prospect of an application, your ex-partner might be more inclined to agree to the sharing of savings. Before making an order the court must be satisfied that you cannot access funds through commercial borrowing.

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