My wife has student loans in default from before we met. I've recently inherited enough money that I'd like to put a large downpayment

Asked by Houseseeker, Antioch, CA Mon Dec 14, 2009

down on a home. Would it be best if my wife wasn't on the deed? If she isn't on the deed, can the government come after the house as community property? Thanks in advance.

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Grace Hanamo…, Agent, Cupertino, CA
Mon Dec 14, 2009
BEST ANSWER
Hello Houseseeker and thanks for your post.

As usual, Pacita was spot on with her answer. So long as you can qualify for a loan in only your name with just your income, then you may purchase the home by yourself. Depending on your wife's income and her current FICO scores, her past indebtedness may be more hindrance than help in obtaining a loan. Also, keep in mind that--even in a community property state--an inheritance is not considered community property so the funds from the inheritance belong solely to you, rather than to you and your wfie. Using the money for a home in your name only is wise since adding your wife's name to the home purchased with the inheritance will immediately make the property a communal asset.

To best protect yourself and your family member's bequest, talk with a qualified estate planning attorney for assistance. There are ways to keep assets purchased during a marriage separate and apart from the communal assets, but only a qualified attorney can provide you with a legal opinion of how this is done. And, this may be of benefit to you since Ginnie Mae (the guarantor of student loans) will eventually seek payment or garnishment to repay the student loans taken out by your wife. As Pacita noted, the title company will still require your wife to quit claim any ownership of the home you purchase in your name, as your "sole and separate" asset and this is done as part of the formal process of segregating assets.

Before you do anything, however, understand both your rights and obligations in using your inheritance for the purchase of a home and speak with an attorney to get the best and most accurate legal opinion of your options.

Good luck!

Sincerely,
Grace Morioka, SRES, e-Pro
Area Pro Realty
0 votes
Dan Chase, Home Buyer, Texas City, TX
Tue Jan 5, 2010
You can have the deed put in a trust. You control it, but legally do not exactly own it. Putting your wife on it could allow some creditors to attach the house theoretically...

Since you are already married you might consider a post-nuptial agreement. A legal paper. It might be able to say your assets are yours and not hers.

Either way, you need to ask a genuine lawyer who charges far to much for the best solution here. There are to many angles to guess at. You might give one little detail that would change everything. A lawyer should know to ask enough to get those little details.
1 vote
Voices Member, , Benton County, OR
Mon Jan 4, 2010
You should speak with an attorney, RE Agents are definitely not attorneys.

If they come after the house are you going to tell them, but a Real Estate Pro at Trulia said.....?

It's worth paying for Legal advice if it concerns something as major as your home....period

BTW..Do not think for a moment these Badges suggest any type of expertise because you get them for how many times you post not for contributing anything related to expertise or quality

Dunes
4 points towards
my post a lot Badge..
1 vote
Erica Starkey, Agent, Danville, CA
Mon Jan 4, 2010
I think this question is best answered by an attorney and/or lender. I would be happy to send you some named if that would be helpful. If you are not working with an agent I would be happy to help you find your new home. Let me know how I can help.
Best,
Erica

Erica Jones Starkey
Broker, Co-Founder
DRE# 01503540
JSCA Real Estate Group
Providing Superior Solutions for Your Individual Real Estate Needs
http://www.JSCArealty.com
office: 925.989.1613
fax: 925.905.2417
Web Reference:  http://www.jscarealty.com
0 votes
Bob Georgiou, Agent, Danville, CA
Tue Dec 15, 2009
This is a question for an attorney. The reason why is that California is a community property state and since you are buying the home while married using proceeds that are from an estate, the answer under the law may not be so clear, especially with student loans. This money may (emphasis on may) have to be handled in a certain way e.g. Keping the money in a separate account from the time you get possession of it until it it disposed in the real estate transaction. This is speculation.

Several here have provided good information on being able to qualify on your own. If you can buy the home on your own an agent and mortgage broker can assist you in a sole and separate transaction which is reasonably straight forward.
Web Reference:  http://bob2sell.com
0 votes
Pacita Dimac…, Agent, Oakland, CA
Mon Dec 14, 2009
Your wife's credit isn't going to help you qualify for a loan. If you can qualify on your own, then do so. The loan will only be in your name.

Be sure to consult with a loan officer to determine if you can be preapproved for a loan on your own.

If you're buying it in your name only, and because you're married, expect that at close of escrow, the title company will ask your wife to give you a quit claim deed renouncing any interest in the property.

However, affter you close escrow, you can certainly make changes on how to hold title to your property. If you want to put her on title, you can do so. Or you may want to set up a trust for the property. Ehow has a very basic explanation http://www.ehow.com/how_5580_hold-title-real.html. That's not all there is, but it's a good start.

Just remember: if she is on title, that's good for her. But it's your name on the loan, and only you are responsible and accountable on that loan.

Good luck!
Web Reference:  http://www.PacitaRealtor.com
0 votes
Gene Riemens…, Agent, Brentwood, CA
Mon Dec 14, 2009
We have a similar issue. It is my understanding we can get a lone on my credit alone, but will need to work out some payment arrangement.

You may search all homes on the agent data base (mls) below.
0 votes
, ,
Mon Dec 14, 2009
This is very much a legal question, so please ask an attorney.

My answer is only based on common knowledge and is not legal advice.

In a community property state, it doesn't matter who is on the title of the house (or a car or anything acquired while a couple was married), the house is owned by both parties equally; Therefore, it is here house and they can come after it.

I believe that even in a common law state, a primary residence purchased while a couple was married belongs to both parties equally-whether or not they are on the deed.

I am only answering this question so you realize that you are asking a great question and you shouldn't at some point decide to ignore the issue.

Again, please please contact an attorney.
0 votes
Tony Abad, Agent, El Cajon, CA
Mon Dec 14, 2009
The government probably can - best to contact an attorney before hand. Let me know if you would like a few to contact.
0 votes
Joseph Finne…, Agent, Bethlehem, PA
Mon Dec 14, 2009
In PA, you could purchase the house and get the mortgage in your name. Then your wifes name can be added to the deed after the purchase.
0 votes
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