Divorce & Real Estate

Published on Mar 05, 2020

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PRESENTATION OUTLINE

Divorce & Real Estate

What We'll Cover

  • Types of co-ownership
  • Spousal rights to real property
  • Division of property
  • Agent duties & obligations

Co-Ownership Interests

Photo by seanmcgrath

Tenants in Common

  • Two or more owners
  • Undivided, equal interest
  • Rents & profits
  • Partition
Photo by Yoann Boyer

Tenancy by the Entirity

  • If owners are married, presumed unless otherwise stated
  • NOT 1/2 interest...each by the entirety
  • Right of survivorship
  • 120 hr rule

Non-Marital Survivorship

  • concurrent life estates in the two grantees as tenants in common, with a contingent remainder to the survivor
Photo by Adam Griffith

Transfer on Death Deeds

  • designate a beneficiary or beneficiaries who will acquire title to specified real property on the individual’s death.
Photo by Rhodi Lopez

Estates in Land

Fee Simple Absolute

Life Estates

  • Duration limited by life of some person
  • Alienable

Other Types of Fees

  • “. . . to A for so long as the property is used for school purposes, but if it ceases to be used for school purposes, then the property reverts back to the grantor.”
  • [Fee simple defeasible / fee simple subject to condition subsequent]
Photo by blavandmaster

Reversion

  • “. . . to A for life.”
  • If the grantor does not deed the future interest to a third party, then it is deemed to be retained by the grantor.
Photo by Gunnar Wrobel

Remainder

  • “. . . to A for life, then to B.”
  • B is an identifiable person and A’s interest is certain to end, so B has a vested remainder.

Adding Partners to Title - Pitfalls

  • Mortgage with a due-on-sale
  • Title Insurance
  • Tax Consequences
  • Owner w/o mortgage obligation
Photo by angela7dreams

Rights During Marriage

  • Power to convey interest
  • Grantee subject to right of survivorship of remaining spouse
  • "Subject to defeasance by his death prior to that of his cotenant."
Photo by sickmouthy

Community Property v. Equitable Distribution

Photo by Naomi Hébert

Equitable Distribution

  • Current earnings
  • Future potential earnings
  • Value of stay-at-home spouse
Photo by bark

Distribution of Assets

  • Martial settlement agreement
  • Judicial court order

Practical Considerations

  • Buyout of spouse's interest
  • Refi with one spouse only
  • Short Sale
  • Empty house stigma

Agent Issues

  • Client conflicts
  • Confidential information
Photo by Austin Distel

Options

  • Sell and divide proceeds
  • Buyout
  • Defer sale
Photo by Eric Ward

Considerations

  • Check ownership/title & court order
  • Provide same advice to both parties
  • Stay neutral
  • Remind parties of the value of cooperation
  • Refer to experts (tax specialists, attorney)

Removing/Adding Parties to Title

  • Review mortgage/deed of trust
  • Verify no impact on title insurance
  • Consider potential tax consequences
Photo by Alex Iby

Quitclaim Deeds

  • Quit Claim
  • Quipclaim
Photo by Trey Ratcliff