In Part One of this two-part blog series, we discussed the most common questions we get from someone who wants to buy a house from someone getting divorced. But what if you’re already divorced and you’ve now discovered that there’s a lien on the home you want to sell? What do you do then?
What Do Title Companies Do?
Title companies do most of their remediation work behind the scenes. Often, the buyer isn’t even aware that a title defect existed and was resolved before he closed on the property. Other times, he may be asked to sign a document to remove or release a lien or title defect. Many title issues are resolved by filing one of three common documents:
- A quit claim deed, which can remove an heir or clear up title between co-owners or spouses.
- A release of lien/judgment, which can remove a paid mortgage or an alimony or child support lien.
- A deed of reconveyance, which can record payment of a mortgage under a deed of trust.
How Do I Remove My Ex From My Property?
As part of a divorce proceeding, the court issues a decree (sometimes called an order or judgment) that divides the assets between the spouses. But, in most cases, a decree does not actually transfer property to or from a spouse; it only describes how the assets are to be distributed. It is up to you and your ex to ensure that the property goes to whomever the court ordered.
First, if you recently divorced, you should ensure that your property is distributed as described in your divorce decree. All real estate is transferred by deed. Therefore, shortly after your divorce, you should execute any deeds required to effectuate the transfers described in your judgment.
Failing to transfer the property at the time of the divorce can create problems that will surface later. Years pass, the former spouses remarry, and life goes on. The exes assume that their property was transferred. Then one of them decides to sell or refinance the property and only then discovers that his ex is still an owner.
Acting quickly—while your divorce is still fresh—offers you the best opportunity to prevent future complications. It also avoids the need to track down your ex and convince him or her to sign the deed at a later time.
What Kind of Deed Do I Use?
Several types of deeds can transfer real estate to an ex. These deeds are known by the warranty of title they provide.
The spouse relinquishing ownership could use a special warranty deed or warranty deed to convey ownership to the other spouse with a warranty of title. However, when transferring property post-divorce, most people won’t want to provide their exes with a warranty (unless required to do so by the judge).
Because a quitclaim deed provides no warranty, it is the most popular deed to transfer ownership when the goal is simply to remove the ex from the title. It is more a release of the property than a conveyance. The spouse who will no longer own the property will release—or quitclaim—his or her interest to the other.
What Interest Does My Deed Convey?
When spouses jointly own property, they are each considered to own an interest in the entire property. It is for this reason that the entire property should be included in the deed. Some spouses mistakenly transfer just a one-half interest in the property, thinking this will transfer his or her interest. But this is not usually how co-ownership of real estate works. To avoid the risk of future title issues, the spouse who will relinquish ownership should sign a quitclaim conveying the entire property to the spouse who will retain ownership.
Both spouses should sign the quitclaim deed if it is being signed before their divorce is final. Having both spouses on the deed avoids questions about homestead or community property rights and assures third parties that no other consents are required for the transfer.
It is also good practice for the deed to reference the divorce decree. This creates a record that the property was divided as part of a divorce. For example, the deed might state:
This Quitclaim Deed is made to divide the property of the parties hereto pursuant to the Final Decree of Divorce issued by the 77th Judicial District Court, Freestone County, Texas, CV12-345-B, dated January 1, 2012.
When it’s time to sell or refinance the property, having this information in the chain of title can facilitate that transfer. In Florida, you will also avoid paying unnecessary doc stamps.
If you and your soon-to-be-ex can agree on how to resolve your financial issues before you divorce, you are one step ahead of most others in avoiding the financial and emotional stresses that arise in the divorce process… and that can even arise later. And if you want to ensure that you take all steps necessary to recognize your status as a single person again, reach out to Joryn Jenkins at Joryn@OpenPalmLaw.com or find her at OpenPalmLaw, where we are changing the way the world gets divorced!
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Joryn, attorney and Open Palm Founder, began her own firm here in Tampa after a 14-year career in law, two of which she served as a professor of law at Stetson University. She is a recipient of the prestigious A. Sherman Christensen Award, an honor bestowed in the United States Supreme Court upon those who have provided exceptional leadership in the American Inns of Court Movement. For more information on Joryn’s professional experience, take a look at her resume.