Often times, and for good reason, clients have concerns about how they are going to pay for their divorce. If the case is simple, it may just be a matter of paying their attorney fees. But if it is more complicated, it could involve substantial expert fees as well. These concerns are increased exponentially if the client is the dependent spouse, who does not work outside the home and does not have access to funds. Then a concern about meeting day to day living expenses may arise as well.
While a party to a divorce in Pennsylvania can request interim counsel fees as part of equitable distribution, they are not often granted. So what is a person in the middle of a divorce to do?
Brendan Lyle, an entrepreneur from Austalia, started a business in New York City to help people going through a divorce pay their counsel, their experts and other expenses. In a recent article on Mr. Lyle in the Wall Street Journal, Anne Kadet writes:
Mr. Lyle’s company fronted the legal fees and got paid when the settlements rolled in. . . . So far, he’s loaned cash to 25 divorcees in amounts ranging from $20,000 to $700,000, with the typical loan averaging $260,000. Clients use the money to cover the costs of lawyers, forensic accountants and living expenses. Can you imagine borrowing that much to get divorced? It could be worse. Mr. Lyle’s biggest case was back in Australia, where a client borrowed $500,000 to pay her divorce lawyers, plus another $300,000 for her criminal defense. She was up on attempted murder charges for trying to stab her husband with a butter knife.
While a loan from Mr. Lyle may not be for everyone (in fact, most), it is an interesting solution to a frequent problem. Much more often, however, we see parties taking loans from family members or friends or paying their expenses on credit cards until their divorce is finalized. Clients can also consider advancing money from a home equity line of credit or other funds from the marital estate to pay for a divorce. Additionally, parties in the midst of a divorce can explore borrowing against a non-retirement portfolio, using the investments — stocks, bonds, mutual funds — as collateral. Regardless of the path chosen, there are creative ways to finance a divorce out there.