SHOULD BOTH HUSBAND & WIFE BE ON THE DEED? WHY NOT?

By
Services for Real Estate Pros with William S. Cherry & No Co., Wealth Coach

Years ago, and we're talking about YEARS AGO, when a husband and wife bought a home in Texas, the law required that the woman sign the papers in a room that was private and away from her husband's earshot or obvious ongoing influence.

The title attorney was required to ask her at least three questions before she signed:  Do you know that when you sign these papers, you are buying this house in a 50-50 partnership with your husband?  Do you know that you and your husband will owe money and will have to pay it back in monthly installments of X apiece until 19xx?  If the wife said, "no," to any or all, that ended the whole thing. No sale, no purchase.

So to get around that foolishness, often times the husband bought the new family home in his name only, and it was left to the Texas homestead laws to take care of the wife.  The homestead laws said that it didn't matter if the wife's name was left off of the deed; she owned half anyway.  And it further said that he would not be able to sell the home in the future without her joint permission.

Well, that business of having the wife sign separately has not been required for at least fifty years, but for some reason, buying the family home only in the name of the husband has continued.  And apparently Texas isn't the only place where it has. 

We frequently get questions about its implications on the Active Rain Question and Answer site.

It is my opinion that Realtors should encourage that both parties be named on the deed and further, that it would be a good idea for those family homes that were closed in only one name to be reworked to name the wife as an equal owner.  The title company or any attorney can do this by filing a correction deed in the public records.  The cost is minimal.

Is it necessary?  Probably not, but it will certainly go a long way in further shoring up the marriage.

Bill Cherry on the web

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Comments 17 New Comment

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Rainer
126,237
Tony Grego, 317-663-4173 #1 Trade Association for Alternative Inv
REISA - 317-663-4173

Laws seem to differ per state along with investor requirements. 

 

Good post.

 

Thanks

Tony 

April 02, 2008 07:46 AM
Rainer
9,215
Kathryn Tharp
Rancho Cucamonga, Real Estate Specialist
Realtor

My experience has been that leaving one spouse off the deed was usually caused by the finance company.  A recent case in point, both borrower's had over 720 mid FICOs, both made great money, Dentist and Network Administrator.  One of them had filed and discharged a bankruptcy 9 years and 10 months ago.  The bank would not loan with both on the note.  So we had to remove one spouse and go stated. 

April 02, 2008 07:58 AM
Rainer
26,036
Stephen Graham
Inactive
Be careful here. We should not advise people how to take title, as that is practicing law; however, we can explain what the different types of title mean and what they are: Joint tenancy, tenancy in common, tenancy by the entirety & community property. In Georgia, we only have joint tenancy & tenancy in common. The main difference between the two is "survivorship".
April 02, 2008 08:12 AM
Rainmaker
27,419
Christina Strommen Stevens
Realty Associates, Team Stevens

Like Bill touched on, this is most likely a marital issue for good health and not necessarily a title issue.  Yes Stephen is right when saying we have to proceed with caution.  I had a deal where the wife found out the husband was not planning to put her on the title.  She was upset and in the end got her way but she sure gave me an earful about him and how she felt like he was always giving her the short stick in their marriage.  It was not good for their relationship. 

As a married lady, well I would not be happy if my husband wanted to spend OUR money and not put me on the title.  It would just not happen, period.

 

April 02, 2008 08:16 AM
Rainmaker
318,916
BILL CHERRY
William S. Cherry & No Co., Wealth Coach
William S. Cherry & No Co., Wealth Coach

I don't agree that expressing an opinion on  how to take title is practicing law. 

And let me also add that any mortgage lender pressing requirements that prevent both parties from being on the title needs to be legally reprimanded. 

As long as the one who is responsible for payment of the loan is on the title, you should be able to include the Empire State Building as a joint titleholder if you want to.

April 02, 2008 12:33 PM
Rainmaker
217,645
Joan Mirantz
Realtor, GRI, CBR, SRES - Concord New Hampshire
Homequest Real Estate
Ahhh Bill Cherry..I suspected you were a very wise man when it comes to women! Now I know it!!
April 02, 2008 02:54 PM
Rainer
1,603
Cheryl Zigas
National TitleNet

From a buyer's standpoint, when I purchased my home in Sparks, NV back in....2002?....my husband's name could not be on the loan docs as he was just starting out his business as a Realtor.  So, the docs were drawn in my name only, and escrow was closed.  After closing, I recorded a deed to add my husband's name.  We had to initially purchase the home this way because the lender wouldn't allow us to record a deed through escrow to both of us.

Now, as an Escrow Officer, I try to ensure that in this situation, both husband and wife are fully educated and understand what that type of vesting means.  Do I give them advice on what's right for them?  Absolutely not.   I just explain the differences.  Ensuring my buyers are well educated in this process is what I do.  Does everyone do that in their closings?  From what I've heard, no way.  As Realtors, I would hope that if you don't fully understand the differences in vesting you would immediately refer your client to another party that would (i.e., a title company and/or a real estate attorney).

Also, a minor point, Bill.  A title company would not record a correction deed.  They would record an entirely new Grant, Bargain and Sale Deed or a Warranty Deed.  A correction deed would be used only if there was error (i.e., legal description has minor flaw) on the original deed.

April 15, 2008 11:58 AM
Rainmaker
591,122
William J. Archambault, Jr.
The Real Estate Investment Institute

Bill,

Wow, that's something I've never heard of. Privet closings for the wife. But, no less strange than when I started at the bank. To use a wife's income we had to prove she was sterile or send her to the bank's OB/GYN to determine that her birth control was sufficient. (I was twenty-two and all these women looked like my Mother or Grandmother! Thank God that ended.)

I've never heard of a "Homestead law determing ownership. Either "Dower" of "Community Property" but never "Homestead." It's been 22 years since I practiced in Texas, but I don't remember this.

I would encourage the young newly weds to take title as "Tenants by Entireties" of "Joint Tenants" but older couples should get popper consoling! Second marriages are different, people with children by others should be very careful. Un-married people should form a legal partnership or LLC to hold title.

Bill

April 15, 2008 06:19 PM
Anonymous #9
Anonymous
Bill Cherry

Bill, great stories and even greater comments.  These youngsters ought to listen to us old timers.  They wouldn't screw up so often.

Bill

April 15, 2008 07:38 PM
Anonymous #10
Anonymous
Anonymous

Wow, Bill, that was really interesting.  In all my years in this business, I'd never had a client that was successful at getting the lender to change their mind on the vesting....again, maybe different states, different rules.  Very interesting though, thank you!  And yes, I agree in that if both parties will be residing at the home, and using BOTH incomes to pay the bills, then it would only make sense to have both parties on title.

Also as a side note, Tenants by Entirities wasn't available as vested ownership in Nevada when I lived there.  Interesting how states can be so different....

Cheryl

April 16, 2008 10:02 AM
Anonymous #11
Anonymous
Bill Cherry

Cheryl, that's interesting about Nevada's approach to Tenants by the Entireties.  Nobody must have told them that it is a vested interest by definition.  I'd hate to be an attorney trying to settle an estate there.

Bill

April 16, 2008 11:09 AM
Rainmaker
591,122
William J. Archambault, Jr.
The Real Estate Investment Institute

Bill,

If I may.

Sinice I mentioned "Tenants by the Entireties" Cheryl is right it is not commonly used in NNevada.

Despite lining in NNevada for the last twenty years it's not the whole world. I spent half my caree in Michigan and I write for the entire country.

For the record lenders don't select vesting, but vesting must match the application.

Bill A

 

April 16, 2008 11:45 AM
Rainer
100,660
Cheri Smith
Realtor Prudential Gary Greene
Prudential Gary Greene, Cypress TX
Because of the community property laws in Texas it isn't as important as it is in some other states. However, it always makes life easier by dotting all your Is and crossing all your Ts. So why not do it when you will be signing anyway. You can always go back and do it later. It can save some legal hassle down the line. Especially in my case where I KNOW my husband's ex-wife would fight me for "his" half of the house  if he ever died. If that ever happened, I'd take a chainsaw to the house and cut his half down the middle and tell her to come and get it! lol.
April 16, 2008 12:52 PM
Anonymous #14
Anonymous
Bill Cherry

Miss Cheri' -

There stands today in Galveston on about 54th and Avenue L a home that was sawed in 2.  The wife kept the half that remains on the lot, and the husband had his half moved about a mile away to another lot.

A reminder.  In Texas (and probably many other states as well), if an ex-wife or ex-husband or anyone else for that matter is the named beneficiary on life insurance policies, pension trusts, etc., and the owner dies, the owner's will or trust does not override those designations.

In other words, if the ex-wife is still the beneficiary named on the life insurance policy, she's going to get the bucks when he dies, not the new wife.

April 16, 2008 10:32 PM
Anonymous #15
Anonymous
Williams

I would like to know what happens in a situation like this one.  Both parties have previously been married and presently married for a couple of years. Both parties are retired.  First party wants to put his sons name on the deed to the house and the property because it was always to be the kids inheritance...the wife is left with nothing if anything should happen to the husband other than being able to stay in the house that would not be hers but his sons.  the wife can stay in the house as long as she wants but it isn't hers if she leaves she leaves with nothing because the husband has left her nothing. what legal rights does the wife have???

October 27, 2010 12:08 PM
Rainmaker
318,916
BILL CHERRY
William S. Cherry & No Co., Wealth Coach
William S. Cherry & No Co., Wealth Coach

Williams -

There are two issues here.  First, you didn't say in what state you live.  Second, I'm not an attorney.  So you need to consult with one who specializes in family law in your state.

Here are some generalizations to consider.  First, whose name(s) are on the house's deed now?  The husband's name individually, the husband's name and someone else?

Second, if after the the husband dies he wants the wife to be able to stay in the house as long as she is alive, the house has to be so deeded NOW to give her a life estate interest.  If he dies without the wife having a life estate, then the beneficiaries of his estate (or the joint owners of the house) do not have to allow the wife to continue to live there.

Both parties need to see an attorney and get properly documented how they each want things to go after they are deceased. 

As to what rights the wife has -- now or at the death of the husband -- your state laws will address that, and again, you need to get that information and direction from an attorney licensed in your state.  Good luck.

October 27, 2010 02:43 PM
Rainmaker
211,362
Yvette Chisholm
Associate Broker - Rockville, MD 301-758-9500
Long & Foster Real Estate, Inc.

I think legal advice as such as this should be handled by an attorney who is licensed to practice in the state the home is in.  I understand the message you are trying to give and it is important, but that is beyond the scope of my license in MD, DC, and VA.  

November 20, 2011 09:02 PM
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Rainmaker
318,916

BILL CHERRY

William S. Cherry & No Co., Wealth Coach
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