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Special Warranty Deed - will it get my name off the deed and mortgage?
Anonymous2 views2 answers
Will a Special Warranty Deed allow me to sign the home over to my spouse, allow him to refinance the mortgage in his name only and remove my name from deed/mortgage? If this is signed and he defaults on the mortgage in the future, is there any penalty to me? Also, can a Special Warranty Deed be signed be signed PRIOR to the divorce decree?
We are in the middle stage of a divorce. I am not interested in keeping our home, and I have agreed to give it to my husband as part of the divorce. There is not much equity in the house, and I am not interested in obtaining a portion of the equity. I merely want to have my name removed from the mortgage and lien so that I can proceed with purchasing my own home after the divorce.
Our broker was the one who suggested signing a Special Warranty Deed as part of the divorce decree.
A special warranty deed can be signed at any time. The only thing that may block you is if there are orders in place (think if you have heard the term "standing orders" or "injunction") denying you the ability to transfer property without court approval.
The special warranty deed will only address who owns the home, not who pays the mortgage.
A mortgage is a contractual agreement between a third party (the mortgage company) and whoever signed the document. Probably both you and your spouse. To refinance the mortgage, your spouse will need to speak with the mortgage company and see if that is even possible to take your name off. Sometimes, one spouse does not make enough for the mortgage company to allow it.
If the mortgage company removes your name from the mortgage, then if he defaults, you see no penalty.
Another option (if he cannot refinance the mortgage into his own name) is to sign the special warranty deed and he signs a "Deed of Trust to Secure Assumption" which states that while you both are on the mortgage, he has agreed to pay all of it. If he misses a payment, you have the right to foreclose on the home to pay off the mortgage.
I hope this helps.
I agree with Mr. Harding above.
When the divorce is finalized you will sign a Special Warranty Deed. He will then file that wth the property records of your county and be the owner of the house.
Your ex will sign a Deed of Trust to Secure Assumption. You will use this document to get your name off of the existing mortgage. Mortgage companies vary. I have been successful with getting a mortgage company to send a packet of information to accomplish taking one spouse off of the mortgage without having to refinance. Contact your mortgage holder and ask if you can take your name off of the mortgage with an executed Deed of Trust to Secure Assumption.
Hope this helps!
Rita Hecker Anderson
