Anne and Sam, a couple in their early 60s, were living together three whole years until they had decided to enter divorce mediation. They were indeed stuck and absolutely miserable when they arrived here for their own custom divorce mediation.
They could not decide, for the lives of them, who would keep and who would leave their home. They had been debating this for years, without arriving at a solution. Anne had enough money to keep the house on her $145,000 a year salary as a university administrator, but Sam’s part-time self-employment income was only $39,000, before business expenses, and he was in the red after accounting for those expenses.
Sam had designed the home, wanted to stay in it and pass it along to the couples’ two children. Anne, on the other hand, although she could buy-out Sam’s half interest in the home, and just pay the expenses, had no interest in living there. What to do? Our expert Certified Divorce Financial Analyst did an excellent projection of their net after tax incomes now and long into their 90th decade, with each one living in the house and each one living in a condominium at the price they desired and could afford.
When Sam’s 97 year old mother, who has had Alzheimer’s Disease for twelve years already, dies, he will inherit 4.5 million dollars. Using the “Seven Visual Steps to Yes”* model delineated in my most recent book, I asked Anne what she really wanted. “To be separated as soon as possible”, she replied. Sam replied to the same question “I don’t want to move. I want to live in the house.” Anne answered my Step II question “What do you bottom-line need, with the answer “a home!”. Sam answered, “the home I designed!”
When asked Step III question “What really, really matters to you?” Anne and Sam had lots of answers: Anne really, really needed to separate soon, have the divorce mediation finished, have her own home, have enough money for retirement, plus enough money after paying house and personal expenses to share with Sam contributing to their adult children’s graduate school expenses.
What really, really mattered to Sam, alternatively, were continuity, not to move, passing on the house he had designed to the children, having their childhood home for them to return to, and not losing his self-designed home that he would, after all, well be able to afford when his mother died – just not right now. He wanted the divorce mediation finished as much, if not more. than Ann did!
Step IV in the “Seven Visual Steps to Yes” in divorce mediation is to personally decide what is a person’s own best personal alternative if they can’t reach an agreement with the other party. Anne felt selfish about it, but knew her best alternative was to refuse to buy out Sam’s interest in the house or to live in it until Sam’s mother died, which would force its sale. Sam felt they were at an impasse and had no best personal alternative.
Step V in the “Seven Visual Steps to Yes” in divorce mediation is to brainstorm creative options or alternatives. Sam’s first option was for Anne to live in the home until he received his inheritance. Anne’s was to sell the house. Sam proposed Anne paying him some alimony until he started receiving Social Security payments in two years. Anne countered that she had received a moderate inheritance, maybe the bank would give her a mortgage for her own home. Sam suggested, then took back the suggestion, that he find out how much rent he could collect from one or two tenants. He knew tenants’ income was not guaranteed and could disappear overnight. He then wondered whether he could access part of the trust funds before his mother died.
Anne and Sam were at Step VI: The Building Agreement Step of making supposals and proposals to one another in their divorce mediation. Sam “supposed” that Anne get a mortgage for a new home with the back-up of her inheritance money. Anne agreed, then came back the next day saying that she would need that money for retirement. Sam “supposed” that Anne stay in the house until he receives his inheritance. Anne agreed and then changed her mind. In order to live there she would have to make improvements and do maintenance on the home which she didn’t want to pay for for a house she wasn’t going to keep. They were getting nowhere with their “supposals and proposals”.
As the mediator, I suggested that he, with his large amount of equity in the house, and as sole beneficiary to his mother’s trust, apply for an individual mortgage to the bank they had been with for thirty years. Sam replied that credit was so tight, that couldn’t happen. “Make an application” I suggested. Shock and awe. Sam received the mortgage from his long-time cooperative bank to pay Anne half of her equity. She paid him some alimony until his payments started. Anne used her buy-out money from the home to put down a substantial down payment on a condominium she loved and she kept her inheritance in place for her retirement. Their Certified Divorce Financial Analyst did a quick addition to their net incomes, he in the house, she in her new condominium. They were both well set financially for life.
No wonder Anne and Sam had had a difficult time seeing possibilities for who could buy out whom to arrive an at equitable divorce mediation settlement. Theirs was truly an out-of-the-box settlement– a shock and awe divorce mediation solution!
Anne and Sam achieved this shock and awe solution at Janet Miller Wiseman, Mediation and Clinical Services Lexington, MA.