Expert: Dick Dennis - 3/9/2010

Question
QUESTION: I have an outstanding stud. loan which is in default.  For this reason, my husband is building a house which is to be in his name only and the bank says I have to sign a quitclaim deed (or some such thing).  He is going to leave the house to his son.  Should I sign the papers they want, or can he do this another way so that I have some rights/interest in the house?  Thanks!

ANSWER: This doesn't seem right, Kathy. Do I get the impression you are not your husband's first wife? It is not necessary to NOT have you on the title of the house if the bank is giving the loan to your husband only. The bank simply makes him solely responsible for the mortgage. You can certainly be on title even though you are not on the mortgage.

The reason why the bank requests that you sign a quitclaim deed prior to your husband getting the loan is because the bank is being ultra careful in who is responsible for the loan, since you are married and husband and wife usually own assets together. And the bank does not want you to have any interest in the property while giving him the loan.

It can be done this way: after they give him the loan, you have a title company agent or an escrow officer (depending on your state) fill out a warranty deed, grant deed or quitclaim deed giving you and your husband title as husband and wife. I recommend you consult with a real estate attorney to know exactly how you should be taking title together, i.e., joint tenants, tenants in common, whatever. The attorney will explain the difference to you.

However, it has me concerned why your husband would leave the house to his son rather than to you unless it is exclusively his money that is being used to buy the property ahd build the house and the funds might be part of a previous trust or something like that. You might ask the attorney that question, too. I do wish you well.

Dick Dennis
dixiedee13@aol.com

---------- FOLLOW-UP ----------

QUESTION: But if I sign the quitclaim deed in order for him to get the loan, I have no assurance that he would go to a title company agent & put me on there, too.  Yes, this is his son by his first marriage (we're both around 50) and his son is well-educated and certainly able to take care of himself.  Though my husband earns 4 times what I do, I would still be contributing to the purchase and work pertaining to the house.  This is not trust money - it's our money.  And I would have no recourse if he never put me on the title, right?

Answer
Yes, I did get that feeling from before, Kathy. I had the feeling that trust had been eroded in your relationship somehow. It's not for me to say anything in that matter and I will not. But if it was me, I would negotiate with my husband, saying that I will sign the quitclaim deed if he signs a warranty deed (not knowing your state, some states use grant deeds or security deeds) that gives title to him and me . . . that will be recorded (by the attorney or me) AFTER he gets the loan and the title is put into his name and mine.

That is part of the reason why I suggested you consult with a real estate attorney to protect your interests, Kathy. I know what trust is in a marriage relationship. I've been married 56 years and I guarantee you that my wife never has any reason to be concerned with owning property or its monetary values even though I know all kinds of ways to trick her if I really wanted to.

If you have reason to suspect your husband's trust, then you should see that real estate attorney BEFORE you sign anything.

Dick Dennis