We bought a house a few months ago. Her credit was no-so-hot, so everything is in my name. She wants to be added to title. I have no problem with this if it makes sense and interested parties have no problem with it.
The housing market is slumping and we’ll probably lose some value over the next year. Also, if something happens to me, there is no way she can pay the house alone. She could sell it, I suppose, but at least in the next year, I profit is questionable to doubtful.
Does it make sense to add her in case something happens to me, or is it just going to increase her negative credit risk with no real upside to her?
When I bought a house in Ohio about 6 years ago, my wife and I were both recent arrivals in the US, but my wife was even more recent than me. We managed to get a loan on my limited credit history (plus ther fact that I had about 25% of the price in cash), but we own the house jointly.
You should be able to transfer the title from sole ownership to joint ownership, but the mortgage-holder needs to know about the change of ownership too, and possily needs to agree to it. Given the possible complications (including possible tax on the transfer), I’d advise using a lawyer or someone else expert in Californian land title law.
It might also be worth checking into what the property ownership laws are in CA. I just sold my house recently in Minnesota. I was married when I bought the house, and had divorced and remarried by the time it sold. I
learned after it had sold that by MN law, your spouse is automatically considered 50% owner of any real estate, regardless of whose name is on the title. Made for a somewhat awkward closing for all concerned, since both my husband and ex-husband needed to be there to sign all the paperwork.
I had planned to seek tax advice and consent of the lender. I guess my thought was that if “we” buy a house, the price then drops, she really gets nothing out of being on title except potential trouble.
Well, California is a community property state, isn’t it? So whether or not she is on the title, the house is half hers provided it was aquired during the marriage.
If you die with a will that says she gets everything, the whole house becomes hers whether she is on the title or not. This may be true even if you don’t have a will.
If you divorce, she is very likely to get half the house (or half the equity) whether she is on the title or not. This I know, because a friends ex-husband put the titles of everything (house, both cars) in his name and she still got half.
I don’t really see a need to go through the trouble of putting her on the title. It sounds like a lot of work for no real benefit.
In states that do not have community property, it can make sense to make the property explcitly tenancy by the entirities because that property is insulated from individual creditors of either spouse. So, for example, a couple would probably hold their home as entirities property (this is the presumption, anyway) and make sure that life insurance is available to cover the mortgage. As you can see from the article, different rules apply in community property states.