Once you and your spouse decide on who is going to keep the home after the divorce, you need to ensure that the deed is solely in the name of the person retaining ownership. If you are the spouse retaining ownership, you can choose to file a quit claim deed or opt for an interspousal transfer. Before deciding which is best for your situation, it is important you understand how each works and under which situations each should be used.
What Is a Quit Claim?
When you file a quit claim, you are stating that you are taking on ownership of the home and that your spouse has no further interest in it. Regardless of what transpires on the property, your spouse will have no claim to it or anything attached to it. For instance, if oil is discovered on the land after the deed is filed, your spouse would have no right to claim any share in the oil or earnings.
However, it is important to note that the quit claim does not necessarily mean that your spouse would be giving up his or her liability for the home's mortgage or any other debts connected to the property. You and your spouse would need to sign an agreement that would remove his or her liability.
What Is an Interspousal Transfer?
An interspousal transfer also gives you ownership of the property. However, if your spouse is seeking to maintain some interest in the property, the interspousal transfer would allow it. Some married couples who have used this particular deed transfer have done so without any intention of divorcing. The transfer has been used in the past to avoid tax liability. Couples have also used it to remove the name of a spouse with poor credit in a bid to get a better interest rate on the home mortgage.
Which Should You Use?
You and your spouse can choose to use either method for transferring the deed. The interspousal transfer is usually more cost-effective, but can take more work to complete. The quit claim deed is often easier to complete. Your county might only require you to complete a form to file it.
To ensure that you and your spouse make the right decision, talk to an experienced divorce attorney. He or she can help you assess your property situation and make a recommendation that is best according to your state's laws and the specifics of your divorce.
Contact a lawyer such as Lisa M Pacione, Attorney At Law to learn more.