Before you Reach an Agreement: Three Things to Consider

Reaching agreement about property settlement after separation can bring certainty, reduce legal costs and help both people move forward. However, an agreement should not be treated as a simple exercise in dividing bank accounts and the family home. It may affect your financial security for many years and, once formalised, can be difficult to change. 

If you are considering a property settlement in Australia, three issues deserve particular attention: understanding the complete financial picture, assessing whether the proposed outcome is fair and workable, and choosing the right way to formalise the agreement. The discussion below is general and applies broadly to married and de facto couples, although individual circumstances and some procedural rules may differ. 

Know what is in your property pool

You should not agree to a division until you have a reliable picture of both parties’ financial circumstances. This generally means identifying assets, liabilities, superannuation interests and other financial resources, whether held personally, jointly or through a company, trust or other structure. Relevant items may include property ownership, mortgages, bank accounts, shares, businesses, vehicles, tax liabilities, personal loans, credit cards, inheritances, expected entitlements and overseas assets. 

Family law imposes duties of financial disclosure. In practical terms, do not rely only on a schedule prepared from memory or on verbal assurances. Ask for source documents such as recent bank and loan statements, tax returns, payslips, superannuation statements, company accounts and trust records. If something is unclear, raise it before agreement. A failure to disclose material information can create serious problems and may provide a basis for later challenge.  Your lawyer can assist with requesting financial disclosure on your behalf. 

Values also matter. The figure attached to a home, business or unusual asset should be current and supported by appropriate evidence. An independent valuation may be worthwhile where an estimate is disputed or the asset is complex. Superannuation should not be overlooked simply because it is not immediately available as cash: it is treated as property for family law purposes and may be divided under an agreement or court order. Before accepting any proposal, check both the value and the practical effect of any proposed superannuation split. 

Is the outcome fair and workable?

A percentage split that appears equal is not automatically fair, and a proposal that appears generous may not be workable. The family law framework looks beyond whose name appears on legal title. Relevant considerations can include the parties’ financial and non-financial contributions, homemaking and parenting contributions, their current circumstances and factors affecting their respective futures. 

Future considerations may include age, health, income and earning capacity, responsibility for children, available financial resources and the practical consequences of family violence, including its economic effect. Changes to the Family Law Act in 2025 expressly recognise the economic impact of family violence in property matters. If violence, coercion or financial control has affected negotiations, disclosure or your ability to make decisions freely, tell your lawyer and consider whether direct negotiation is safe. 

Consider the after-tax and cash-flow result, not merely the headline value. Keeping the home may require refinancing and the capacity to meet rates, insurance, maintenance and mortgage payments. Transferring or selling assets may involve capital gains tax, stamp duty consequences, transaction costs or timing risks. A person receiving more superannuation but less cash may have a very different short-term position from someone receiving liquid assets. Obtain taxation, financial planning or accounting advice where the proposal includes a business, trust, investment property, unusual superannuation interest or significant tax exposure. 

Formalise the agreement properly and on time

An informal arrangement, email exchange or signed note will not provide the finality or enforceability you expect. Property settlements are commonly formalised through consent orders or a Binding Financial Agreement under the Family Law Act 1975. 

Consent orders are agreed terms submitted to the Court. The parties ordinarily do not need to attend a hearing, but the Court must be satisfied that the proposed property orders are just and equitable. Once made, they are binding court orders and generally can be altered only in limited circumstances. If a superannuation split is proposed, procedural requirements apply, including giving the fund trustee an opportunity to review the proposed wording. 

A Binding Financial Agreement can exclude the Court’s jurisdiction over some or all financial issues if it is valid and binding. It is a technical document, and each party must receive independent legal advice about its effect and the advantages and disadvantages of entering it. Financial agreements can be set aside in very limited circumstances, so careful drafting, disclosure and genuine freedom of decision-making are critical. 

Timing is equally important. Applications for property orders are generally required within 12 months after a divorce becomes final for married couples, or within two years after a de facto relationship ends. Permission to proceed out of time is not automatic. Do not delay advice because negotiations seem cooperative. Your documents should also state clearly who must do what, by when, how assets and debts will be transferred or sold, what happens if refinancing fails, and how associated costs will be paid. 

Before you sign 

A sound property settlement begins with complete information, reflects both the legal framework and real-world consequences, and is documented in a form that produces finality. Before signing, make sure you understand the entire property pool, the reasons for the proposed division, the risks and costs of implementation, and the rights you may be giving up. Independent legal advice can help you identify issues that are easy to miss when your focus is understandably on reaching agreement. 

This article provides general information only and is not legal advice. Family law outcomes depend on individual circumstances. MobbsMarr Lawyers are family law experts.  Reach out to us for an obligation fee initial consultation.