in the headlines, one of the latest involving former Central Intelligence Agency director David Petraeus. While there seems to be an endless appetite for stories about infidelity involving celebrities or those in the halls of power, in most cases divorce courts couldn't care less. The price tags on affairs that blow up a marriage come out of negotiated settlements. This is because in states with no-fault divorce laws - which allow people to divorce without having to document specific reasons the marriage went south - courts aren't looking for blame. So affairs and other disasters of the heart don't matter. Financial awards usually just come down to formulas. And while it's impossible to pinpoint exactly how many divorces occur because of cheating, it's considered commonplace and courts are inured to its impact."I think it's probably present in at least half of divorces," says Randall M. Kessler, a family lawyer in Atlanta. Take the case of Silvana Roncal, an independent financial consultant in Miami. She caught her husband in a compromising position in the middle of the night with their live-in nanny three years ago, and she thought her life couldn't get much worse. But it did. "It was a very emotional time," says Roncal, who became severely depressed as her 18-year marriage fell apart. "I left my job, saw my house go into foreclosure, declared bankruptcy and everything went down the drain."Think a hefty alimony might be a fitting punishment for the pain of her husband's affair? Hardly. Roncal, a 54-year-old mother of two, wound up paying spousal support of $2,500 per month to her ex-husband, who never worked during their marriage and is still without a job.
"Florida is a no-fault state," says Roncal. "They don't care about what happens during the marriage."Outside of the court system, where 95 percent of divorces are settled, infidelity can matter a lot. Here's this site If the parties have signed a this site prenuptial and postnuptial agreements already consider a possible affair. "They'll often read that in the event one of the parties cheats, the award will be X dollars a month higher," says Robert Wallack, a matrimonial attorney in New York. "I had one case where a contract stated that if the husband cheated, and if the wife could prove it, she would control his real estate holdings."And, indeed, Wallack's client became quite the real estate magnate.
One cautionary note for spouses very angry about cheating: Don't let emotions get out of control. Fighting to prove a point or assess punishment will just cost more. "The legal professional will get a lot of that money," says Alan Frisher, a certified divorce planning adviser in Melbourne, Florida. Roncal can attest to that. Because she was the main breadwinner, she ended up depleting her assets in a legal battle with her husband, and then settled, rather than spend even more to go to court. But she regrets it now and offers this advice: Get a really good lawyer or a mediator to help negotiate how much alimony you'll receive or pay out.2. If the cheater has spent a lot of money on the paramour:
"I had a situation where a husband rented an apartment to conduct an affair," says Wallack. "It cost $5,000 a month, and he rented it for two years."The wife ended up getting $120,000, on top of her alimony to compensate for that expenditure. For these kinds of cases, documentation is important, but be careful how you document. Arianna Jeret, a divorce mediator in Redondo Beach, California, warns that many spouses learn about affairs by sneaking into the cheating spouse's email or Facebook account."This is essentially considered hacking and could actually put the non-cheating spouse at risk for criminal litigation," she says. Frisher adds: "Money typically has a trail, and you can get a forensic accountant to find evidence. But that can take a lot of time and expense, so it better be worth it. Otherwise it can end up costing you a lot more to get your retribution than it was actually worth."3. If there's been extremely poor conduct or some type of this site win on this score, the conduct has to be outside the bounds of normal decency, says Wallack. "If a husband flaunts his affair in his wife's face, or it can be shown he was ignoring his kids and other family responsibilities, that might be a contributing factor," he said. While the financial impact might not be punitive, this kind of conduct can push the numbers, Wallack says. So if a husband with deep pockets has cheated on his wife, and she is looking to receive anywhere from $10,000 to $13,000 a month, Wallack says a sympathetic settlement might end up with the man paying on the higher end of the scale.
Dec 10 If the American dream is to own a house, you know you've really arrived when you have two of them. In 2011, Allison and Doug Gumbs, of Washington Crossing, Pennsylvania, bought their second house, in Avalon, New Jersey, taking advantage of low interest rates and a time when the market was particularly floundering. Allison Gumbs says that their three-bedroom and one-bathroom house was "a major fixer-upper, though down there they call it a 'tear down,' meaning it really just was sold for the lot value."It still cost $720,000, which may sound like a lot for a tear down but due to the location, the Gumbs felt it was a relative bargain. "We always wanted our own beach home," Gumbs says. While owning two homes may be doubling down on the American dream, paying for two mortgages kind of ruins the fun. That's why Allison, a communications consultant, and Doug, a managing partner at a security management firm, rolled the mortgage for their second home into their first."It just seemed easier to consolidate... and less of a burden," Gumbs says. Consolidating two mortgages is about as innovative as it gets when you've got two mortgages to pay, says Josh Moffitt, president of Silverton Mortgage Specialists in Atlanta."These days, there is not as much creativity in lending and available products as there was in the past, and rightly so," says Moffitt, noting the lingering impact of the housing crisis. If you're thinking of whether to consolidate two mortgages or pay each separately, the decision should come down to whether the math works, factoring in the interest rate, fees and terms of the loan. The numbers should also be the deciding factor when deciding whether to have two mortgages at a single financial institution or at two. There is no right or wrong when deciding whether to use one or two lenders.
"Having the loan at two lenders can add some additional paperwork and costs, but it isn't major," Moffitt says. And whether a homeowner opts for one mortgage or two, there are distinct advantages to having a mortgage."Unless an individual strongly dislikes holding debt, it can make sense for them to keep a mortgage even when one is not required, due to the tax deduction of interest, leverage - the opportunity to reinvest the mortgage proceeds and yield a higher return - and increased liquidity," says Sharon Appelman, a director of a financial planning and investment management firm in New York. If you're purchasing a second home, here are some financing issues to consider.
IF YOU CONSOLIDATE When combining mortgages, a homeowner needs to pay attention to whether they will go over the limit of a conforming loan. The limit for a conforming loan is $417,000 in most counties in the country - but it is $625,000 in more expensive markets such as New York and Los Angeles. If the two mortgages exceed the limits of a conforming loan, a homeowner will be required to get a jumbo loan. Historically, that has meant paying a higher interest rate, although in September rates on jumbo loans dipped below conforming loan rates and have so far remained lower, making jumbo loans more appealing than in the past. However, jumbo rates aren't always lower than traditional loans. As with any loan, the best rates depend on one's credit score and what your lender is offering. And because jumbo loans usually require a heftier down payment, sometimes as much as 30 percent, Moffitt says that might negate the advantage of a rate that is half or a full percentage lower than a traditional loan."Jumbo loans can be a little tighter on guidelines when it comes to things like credit score and debt ratio, so it's worth comparing to see if a buyer fits all options," Moffitt says. Borrowers typically need a credit score between 720 and 780 and a debt-to-income ratio of no more than 38 percent.
A big benefit to consolidation is that it can make ownership of two homes a little more efficient. For instance, if rates drop in the future and you want to refinance, you only need to be concerned with getting approval from one mortgage lender instead of two. Consolidating loans has paid off well for the Gumbs. They refinanced the loan for their two homes in 2011, at 4.375 percent, and again in 2012, at 2.875 percent. As a result, they were able to spend $85,000 on the renovations for their second home. Helping to justify their investment in the second home: the value of the houses in their neighborhood is now $100,000 higher, says Gumbs. IF YOU HAVE TWO MORTGAGES There are reasons why maintaining two mortgages can work out well, says Appelman. You could get another home equity line of credit with your second home, but that's usually more difficult to do with a secondary residence. It's probably well worth it, however, if you can get a lender's approval."Some clients like to take one out but keep a zero balance as a contingency plan," Appelman says. Second homes are a little riskier than primary residences from a lender's perspective. "If someone runs into financial issues, they will typically default on the second property first," Moffitt says. And if you plan to use your second home to rent out, it's considered an investment property, which will make it more expensive to borrow. Expect to pay an interest rate that's a half-point to a point higher than you would for a primary residence.