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What is a Binding Financial Agreement

The basics you need to know about Binding Financial Agreements 

A Binding Financial Agreement is a term which includes a variety of different Financial Agreements made during a relationship.

Binding Financial Agreements are also known as a “BFA” or a “Financial Agreement” or a “Relationship Agreement”.

The correct legal term is a “Binding Financial Agreement” if the document is made according to law. There are ‘sub categories’ of BFA’s, named according to the stage of your relationship at which you enter into the Financial  Agreement and the Section of the Family Law Act under which it is made.

Binding Financial Agreement’s include:

 



 

  • “Pre-nuptial Agreements”;
  • “Post-nuptial Agreements”;
  • “Cohabitation Agreements”;
  • “Separation Agreements”; and
  • “Divorce Agreements”.

A Binding Financial Agreement is an agreement between de facto, soon to be married or already married couples, which is made either before, during or after their relationship.

Binding Financial Agreements can be made by de facto couples of the same sex or opposite sex.

The Binding Financial Agreement states how your assets, financial resources and liabilities will be divided if your relationship breaks down.

For more about what provisions can be included in Binding Financial Agreements, read our information sheet What should be put into a Binding Financial Agreement.

Binding Financial Agreements are Contracts between two spouses (partners) to a relationship.

By making a Binding Financial Agreement, the parties lose (contract out of) the right they would otherwise have to ask the Family Courts to decide the division of their property after they separate.

By making a Binding Financial Agreement, the parties agree in advance, how their property will be divided in a property settlement if their relationship fails.

Binding Financial Agreements: What else you should know

Can you prepare your own Binding Financial Agreement without a lawyer. We explain the answer in the information sheet Can I prepare a Binding Financial Agreement myself.

You must be eligible to be able to lawfully enter into a Binding Financial Agreement. Read more in the information sheet Who can enter into a Binding Financial Agreement.

The timing of when you enter into a Binding Financial Agreement can be important. We explain in the information sheet When can you enter into a Binding Financial Agreement.

People often start living together, get engaged, have a baby or even get married and only then think about getting a Binding Financial Agreement. If this applies to you then you should read the information sheet Is it too late to enter into a Binding Financial Agreement.

There are various different types of Binding Financial Agreements. If you do not use the correct type of Binding Financial Agreement for your situation it may later be found to be invalid. We explain more in our information sheet Types of Binding Financial Agreements & What type of BFA do I need.

Will a Binding Financial Agreement actually work to protect your assets and income? Find out in the information sheet Are Binding Financial Agreements actually Binding.

If have entered into a new relationship or are about to and you are thinking about the provision of your Will or what might happen after you die you should know the information in our information sheet How having a Binding Financial Agreement might help your Estate & Succession Planning.

Read the benefits of having a BFA in the information sheet What are the Advantages of a Binding Financial Agreement.

There may be a downside to having a BFA. This is discussed in the information sheet What are the Disadvantages of a Binding Financial Agreement.

Questions such as can your Binding Financial Agreement be changed or updated, what circumstances might have a court declare it invalid and set it aside are answered in the information sheet Can a Binding Financial Agreement be set aside, updated or terminated.

The information sheet How to tell your Partner you want a Binding Financial Agreement might also be helpful to you.

If you have separated or divorced and want to document your property settlement agreement in a legally binding and enforceable way, then the information sheet Should I use a Binding Financial Agreement or a Consent Order will contain important information for you.

 

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