Property Buyout in Amicable Divorce with Mediation support

[wookumus]

What is the name of your state (only U.S. law)? OR
We are going through a relatively amicable divorce and going through mediation to finalize agreements. One agreement is that I will buy out my spouse from our home with a re-fi and his name will be removed from the deed. Unfortunately, because these things obviously take time, I've already had to extend the rate lock on the re-fi once and we are nearing another 30 days without a divorce decree in place. My question, if I agree to go ahead with the re-fi, pay him his share and remove his name from the deed prior to having a decree, what are the potential ramifications. Could he possibly decide to get a lawyer after the fact and pursue the property again? Any thing else I am missing? Probably...please be nice, just looking for help!

 

[adjusterjack]

Yes, it's possible that what you fear could happen.

I suggest you talk to your lawyer about the possibility of an enforceable pre-decree agreement regarding the home.

Pay a lawyer to get it right.

 

[HRZ]

Clarification/suggestion ...you pay your lawyer to,get it safe/right in protecting your interests

 

[LdiJ]

What is the name of your state (only U.S. law)? OR
We are going through a relatively amicable divorce and going through mediation to finalize agreements. One agreement is that I will buy out my spouse from our home with a re-fi and his name will be removed from the deed. Unfortunately, because these things obviously take time, I've already had to extend the rate lock on the re-fi once and we are nearing another 30 days without a divorce decree in place. My question, if I agree to go ahead with the re-fi, pay him his share and remove his name from the deed prior to having a decree, what are the potential ramifications. Could he possibly decide to get a lawyer after the fact and pursue the property again? Any thing else I am missing? Probably...please be nice, just looking for help!

I have a slightly different opinion than the others. While I do agree that there is a risk that he could try to mucky things up by going after the house again, the reality of things is that its highly unlikely that he could actually succeed at doing so as there will be more than ample evidence that you bought him out with the refi.

 

[HRZ]

I'm not up on any quirks of OR law...but as to a home buyout I'd still lean to use lawyer to protect MY interests.

BTW just for starters will STBX be giving you a warranty deed or a mere quit claim deed ...which can be darn unsafe for a lot of reasons . ME I'd want a warranty deed ...and a updated/ rider to title insurance for my protection , not just the lenders interest. IF you are 101% confident there are no loose ends ..do it your way ..otherwise use the services of a lawyer to get it right on your side ( The last somewhat complicated sale of a home I did , just about a month ago, cost a mere $800 for representation by one of the best RE lawyers around and I consider that cheap insurance to get it right .)

I agree a completed transfer sure reads like a completed as agreed distribution of that specific asset ...but my vote does NOT count .

 

[HRZ]

PS , you didn't ask...but I'd be a bit cautious about conversion of STBX into a tenant by any steps or lack of same in my new home ...ask your attorney !

 

[LdiJ]

I'm not up on any quirks of OR law...but as to a home buyout I'd still lean to use lawyer to protect MY interests.

BTW just for starters will STBX be giving you a warranty deed or a mere quit claim deed ...which can be darn unsafe for a lot of reasons . ME I'd want a warranty deed ...and a updated/ rider to title insurance for my protection , not just the lenders interest. IF you are 101% confident there are no loose ends ..do it your way ..otherwise use the services of a lawyer to get it right on your side ( The last somewhat complicated sale of a home I did , just about a month ago, cost a mere $800 for representation by one of the best RE lawyers around and I consider that cheap insurance to get it right .)

I agree a completed transfer sure reads like a completed as agreed distribution of that specific asset ...but my vote does NOT count .

I have never seen or heard of a warranty deed being used in a divorce situation. Maybe it has been somewhere, but I have never heard of it being used to transfer ownership between spouses in a divorce.

 

[HRZ]

LImited warranty deeds are probably more common around me , few use general warranty deeds for much of anything ...I have no clue how divorce practice works ...but OP needs to be confident that there are no other liens or obligations secured by the home ...perhaps she is.

( A simple small line of open credit at a local bank MIGHT involve a recorded interest in home to pay it ... I ve found some very strange stuff in running some preliminary personal title searches but some of the stuff really took a pro to find )

A quit claim deed may be OK ...but I'd rather have MY attorney assure me of same in my fact pattern .

THere may be other ways for each to hold the other harmless...but that's way beyond me .

 

[wookumus]

Great insights, thanks for your time and help!

 

[justalayman]

LImited warranty deeds are probably more common around me , few use general warranty deeds for much of anything ...I have no clue how divorce practice works ...but OP needs to be confident that there are no other liens or obligations secured by the home ...perhaps she is.

( A simple small line of open credit at a local bank MIGHT involve a recorded interest in home to pay it ... I ve found some very strange stuff in running some preliminary personal title searches but some of the stuff really took a pro to find )

A quit claim deed may be OK ...but I'd rather have MY attorney assure me of same in my fact pattern .

THere may be other ways for each to hold the other harmless...but that's way beyond me .

You do realize the buyer can ask a warranty deed be utilized. The seller is not obligated to provide one. It is a negotiated matter.

In a divorce a general warranty deed would be improper. Both owners already have (presumably) a general warranty deed from the party they purchase the property from. If either spouse needed to make a claim against the other due to the divorce action it would immediately fall onto the person they purchase the property from to defend the title they warranteed.

But honestly, I cannot think of a single time I have known a person that has invoked the warranty a general warranty deed actually provides nor have I ever known a person called on to defend the title the warranteed.

Purchasing title insurance is a much wiser action.

A limited warranty deed would be more appropriate in a divorce, if any warranty deed is used, as it warrants only the actions of the grantor not encumbering the title. I can see some situations where it would be a good idea but, as I stated, I've never seen any person defend or make a claim based on a warranty deed.

 

[HRZ]

I have no disagreement with above ...And am not looking to upset a friendly deal but get nervous when somebody asks multiple questions about matters that might be a lot safer if she got some paid help looking over things first ...it seems OK but the time to check things out is before she signs deals .

 

[justalayman]

Not disagreeing but there is no real purpose or benefit of a general warranty deed. The wife already has a warrantee in place from the person they bought the property from (presumption on my part). One from the husband would be redundant, at least. In addition if there was a claim against the title and the wife sought indemnification by the husband, he would simply turn to the person he (and wife) purchased the property from since they are both subject to the same claim against the title.


And personally, if it was me in the place of the husband I would simply refuse to provide a general warranty deed. If wife Wants protection (which she may already have anyway) she should purchase title insurance.