Most divorces-around 90% according to some estimates-are settled "out of court." (More accurately, the court has to enter the divorce decree, so the parties' agreement is approved and adopted by the court.) There are quite a few reasons why settlements are so popular.
First of all, they give the parties maximum control. Any issue not stipulated, or agreed upon, by the parties will go to the judge to decide. Judges have wide discretion in divorce cases, and appeals are very limited. By agreeing outside of court, the parties to a divorce essentially control their own destiny instead of gamble that the judge will decide with them. In many instances, it's better to know you have 50 than to gamble for a change at 100 and end up with zero.
Relatedly, judges are imperfect. They cannot detect lies; they do not understand every minute detail about your marriage; and they are not trained psychologists or social workers. While judges do the best they can, they are human, and they will make mistakes.
Second, settlement agreements save both parties a considerable amount of money. Legal fees for trial are quite high, and those fees can be significantly reduced if the parties settle.
Third, by avoiding trial, settlement agreements can reduce family acrimony. While you may want the opportunity to tell the world everything your spouse did wrong during your marriage, such public discussions are rarely beneficial, particularly if children are involved.
Just because you have a settlement agreement, though, does not mean that a judge is required to accept it. All settlement agreements must meet certain requirements before the judge can approve it. Like all contracts, the settlement agreement must be voluntary and free from duress.
It must also not be obtained by fraudulent means. While divorces are usually final once the trial judges enters the initial decree, fraud is one ground on which to appeal a divorce. If you withheld information about your assets or the performance of your children in school, your spouse can go to court and essentially have the settlement agreement set aside.
Settlement agreements can be entered into any time before the final hearing, but most settlements occur after some discovery.
In order to aid your attorney in the settlement process, you should make a list, either written or just by memory, of the things you want out of your divorce. This list can contain financial items, like your bank account or retirement account; real and personal property items, like your house or a family heirloom; and emotional items, like closure and a certain degree of cordiality. While emotion cannot be negotiated, it is important to maintain perspective throughout the divorce process, and including these types of things on your list may help you do so.
You should divide your list into three categories: things you have to have, things you would like to have, and things you could give up. Your attorney can then use this information as the basis of your settlement agreement.