During the divorce process, it is common for one spouse to receive sole ownership of the marital home.
What happens to the marital home in a divorce when an agreement or judgment provides the one spouse is to receive sole ownership? When a couple divorces, one of the common provisions outlined in their marriage settlement agreement or the court’s judgment concerns the award of the family home to one spouse. In order for the spouse who is awarded the marital home to be able to sell, refinance, or borrow money against the property without their former partner’s consent, the spouse who is awarded the marital home must obtain documentation which shows that their former partner has transferred ownership of their interest in the property and that they are the sole owner of the property.
A deed is used to show the transfer of interest in a property from one party to another.
The legal document used to transfer interest in a property from one individual to another is called a deed. There are various types of deeds including: warranty, grant, and quit claim deeds. Warranty and grant deeds come with the transferor’s promise that the title to the property is without any incumbencies such as, another party’s ownership of the property or outstanding taxes or debts. A quit claim deed does not come with these specific promises and only conveys property on an “as is” basis. In most cases, after a divorce, an ownership interest in the marital home can be transferred from one spouse to another using a quit claim deed.
Each county in California keeps a record of properties and owners within their jurisdiction. A couple that is transferring ownership interest in the marital home will need to conduct a title search in order to determine how the property is held and property’s legal description, prepare and sign the deed as well as, a Preliminary Change of Title Report, and record the documents with the appropriate land records office.
The transfer of ownership in property between spouses is exempt from certain taxes.
According to California law, the transfer of ownership in property from one spouse to another is exempt from transfer taxes. In addition, the transfer in ownership of property from one spouse to another is protected from property tax increases.
Conveying ownership through a deed does not change a spouse’s obligation on a loan. In order for a spouse to end their obligation on a loan, the loan must be paid off or refinanced. In some cases, this is done along with the transfer of ownership during the divorce process.