Getting a divorce recession-style.

• Author: Banschick, Mark
• Position: Economics

IN 2001, The New York Tunes published an article called "As Economy Sours, Divorce Rate Rises." According to the piece, historical divorce rates rose whenever the economy was in trouble. During the recessions in the 1980s and 1990s, for instance, there was an increase in divorce related services on Long Island, N.Y. During the toughest years, some lawyers saw a jump of up to 50%. Even during normal times, money issues often lead to arguments. Predictably, when money becomes scarce, the fights intensify.

The current economic downturn, however, has not followed that trend. A recent survey of divorce attorneys by the American Academy of Matrimonial Lawyers found that 37% said they noticed a significant drop in business. One of the reasons is that the economic issues facing couples in this recession do not involve only tightening belts and downscaling; they also revolve around housing. A fundamental part of getting divorced is dividing marital assets, including the house, which often is the largest asset a couple holds. However, when the mortgage exceeds the value of the house, the only thing left to divide is debt In fight of this reality, some couples decide to postpone divorce. They stay in the same house, but in different rooms.

Another deterrent to divorce is its high cost. The typical complaint about divorce that I see in my office is: how am I going to pay for everything? Like everything else in our country, from health care to a college education, divorce has become financially prohibitive. Worries about jobs, bills, housing, and such make people want to hold onto whatever they have. In the best of limes, divorce is painfully expensive. In this tough economy, it is downright frightening to think of all the money needed for attorneys, accountants, mediators, and psychologists.

Many divorce lawyers are paid $350 an hour or more; hours that are charged even when you are talking on the phone. Some couples decide to be self-represented or pro se, to save money. Counterintuitively, this may lead to an even more expensive process, particularly if one spouse has the upper hand in intimidating the other. Good representation often is a wise move because, in competent hands, it can keep the playing field level. As Cindy Harari, a Florida-based divorce mediator and attorney, points out, "There is not a lot of information available to lay people to clarify and demystify the legal process so they can be in charge of their own decisionmaking." Faced...