Mortgage/ deed question

ninarAugust 18, 2010

I have received helpful advice in my home building here which i am thankful for. Can someone please advice me on this?

My husband and I both make same money and applied for loan together for a home worth about 500 k in Texas.

We have separate finances, and I will be paying for the big chunk of mortgage, so I would like to keep my name only on the deed, upon his agreement. who do I consult to see if this possible? What other things should I keep in mind before I do this?

Because, we just don't know how things will pan out for us in future, we want to keep things hassle free.

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dave_donhoff

Hi ninar,

My husband and I both make same money and applied for loan together for a home worth about 500 k in Texas.

OK.

We have separate finances, and I will be paying for the big chunk of mortgage, so I would like to keep my name only on the deed, upon his agreement. who do I consult to see if this possible?

You need to cancel your current mortgage joint application, and hubby has to apply all on his lonesome.

What other things should I keep in mind before I do this?

The Hubster will have to qualify for the full loan requested on his own income solely, but since Texas is a community property state, he may have to carry any other debt payments you've incurred since you've wed.

Since Texas law assumes comingling of financial affairs unless explicity documented otherwise, I would strongly recommend *NOT* doing this on your own, but getting good professional assistance from a local CPA, or attorney.

Luck!
Dave Donhoff
Leverage Planner

    Bookmark   August 18, 2010 at 3:58PM
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sylviatexas1

I thought OP wanted her name on the deed but not her husband's.

in which case Don's advice is still exactly accurate, only in reverse (wife apply for loan in her name only).

    Bookmark   August 18, 2010 at 4:31PM
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sylviatexas1

forgot to say that Texas is a community property state, & the fact that only one spouse is on the loan does not affect the other spouse's ownership rights.

In fact, title companies almost always have the non-participating spouse come to closing to sign the deed.

so one spouse would be responsible for the entire indebtedness & would own half of the property.

I've only seen this done in instances where the non-participating spouse was a wife who never had worked outside the home (& why he/she/they did it that way I still do not know) or where the non-participating spouse had a problem that would have caused the loan to be declined-maybe bad credit or past-due child support or some such.

I wish you the best.

    Bookmark   August 18, 2010 at 4:35PM
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ninar

Thanks for your responses.
So, even if I do apply for loan based on my sole income and qualify and purchase and pay for the home, my spouse will automatically have ownership of half of it?

Provided that we both make same money and have excellent credit history without any other issues you mentioned- my question should have been- is it a possible scenario, if my spouse agrees to cosign the loan, but is ok to have the deed in my name, on a mutual agreement that I make all the
payments. I know it sounds strange, but- the 20% downpayment comes from me and I am making all the payments. And he is willing to let me have my name only on the deed.

    Bookmark   August 18, 2010 at 4:53PM
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ninar

If both have equal rights on the property regardless of who is paying for it, I guess, id rather have him on there. I was just trying to keep it clean from the get go and protect my investment and have the freedom to do what I want with it if things don't work out.

    Bookmark   August 18, 2010 at 5:03PM
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hendricus

This doesn't sound good to me, planning for failure.

    Bookmark   August 18, 2010 at 5:13PM
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kats_meow

If you want the house to be your separate property (i.e. for your husband not have any ownership in it) then you need to consult legal counsel. Please talk to an attorney before you go any farther on this.

    Bookmark   August 18, 2010 at 5:15PM
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rafor

I have had a house where the deed was solely in my name and both my SO and I were on the mortgage. But we did not live in a community property state and were not married. Bank had no problem with that. I had owned the house for 15 years before he came into the picture and got the house in a divorce settlement and then refinanced when rates were low. Since it was technically "my" house" we had an understanding that it would remain mine. Since have sold that, took the proceeds and paid cash for the next house which is still only in my name since it was bought with the proceeds of the sale of "my" house.

    Bookmark   August 18, 2010 at 6:23PM
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creek_side

What kat said.

Talk to an attorney, not an accountant. There are bound to be ways around the situation, even in a community property state.

    Bookmark   August 18, 2010 at 6:24PM
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ninar

Thank you rafor for sharing your experience.
I will talk to a family law attorney soon.

    Bookmark   August 18, 2010 at 6:34PM
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dave_donhoff

Ninar,

Yes, you can do what you are seekign to do, and its not really even difficult (nor uncommon,) HOWEVER, it has to be done exactly legally correctly.

Texas law (in essence) automatically assumes mutual marital ownership and mutual liability *UNLESS* you explicitly document seperation along the way (which, again, is neither complicated nor uncommon.)

When you consult your attorney, I suggest not seeking to solve merely this INDIVIDUAL instance, but to have him/her educate you in how to properly title assets from here forward, and keeping liabilities (credit & debts) seperate, as desired.

Luck!
Dave Donhoff
Leverage Planner

    Bookmark   August 18, 2010 at 7:58PM
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larke

Do you (any or all) understand that the reason so many people put the house in the non-working wife's name is that if the husband's business fails and creditors come after him for everything, they can't touch the house? It's an old story (and probably your parents did it even if you're unaware) but it's what the majority of people used to do, whether or not they still do it.

    Bookmark   August 19, 2010 at 6:31AM
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creek_side

The OP indicated she makes the same amount of money as her spouse. That indicates she is working. I take her at her word.

    Bookmark   August 19, 2010 at 8:27AM
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dave_donhoff

Hi Larke,

Do you (any or all) understand that the reason so many people put the house in the non-working wife's name is that if the husband's business fails and creditors come after him for everything, they can't touch the house?

You *DO* undestand that your strategy could ONLY be done if the home itself was bought in cash, no mortgage... right?

All mortgage lenders in recourse states make their loan with a lien put in place (regardless who's on title) so that a default gives them the right to foreclose and re-sell in order to make their investors (that would be YOU, if you have retirement investments) whole again.

Cheers,
Dave Donhoff
Leverage Planner

    Bookmark   August 19, 2010 at 2:53PM
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brickeyee

"Do you (any or all) understand that the reason so many people put the house in the non-working wife's name is that if the husband's business fails and creditors come after him for everything, they can't touch the house? "

'Tenants by the entirety' is a a better way for a husband and wife in states that allow it.

Neither individual owns a dividable interest in teh property.
The married couple together owns the proporty, making it unreachable by a debt of either person individually.

You still jave to make sure that a judgement aginst both persons cannot attach.

    Bookmark   August 19, 2010 at 3:25PM
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