I’m a disabled police officer. My wife persuaded me to sign quit-claim deed so she could refinance our home at a better rate. Now she’s hinting at divorce

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I have been married for almost thirty years. I worked the first nine years of our marriage, I was a police officer, and became disabled. Shortly after my disability, my wife encouraged me to sign a quit claim deed on our house that we shared together, in order to refinance in her name alone, to help us reduce our mortgage payments during that difficult time.

She promised me that it would only be temporary, and when our finances improved, we would refinance again, and put me back on title. Well, that never happened. My wife has worked during our entire marriage. My income is under $15,000 per year, which includes my small pension, and Social Security Insurance disability.


‘She promised me that it would only be temporary, and when our finances improved, we would refinance again, and put me back on title. Well, that never happened.’

My wife’s income is over $100,000 per year. We have always filed our IRS taxes jointly. Shortly after my disability, and unbeknownst to me, my wife changed her name, back to her maiden name. In 2012, a message was left on our landline from her bank (we have always had separate accounts), with information about an additional refinance, one I wasn’t aware of.

I asked to be put back on title, but she refinanced our mortgage again, this time in her maiden name, without putting me back on title. She is 65 years old now, and I am 60 years old. She is about to retire from her State of California job, and has been dropping hints, and making statements about divorcing me. She says that she wants to sell our house and move out of state, and that is something I am not interested in doing.

She has a 30-year pension coming, a 401(k), savings, and her checking account. I don’t know how much is in any of those accounts. She is to inherit two homes when her parents pass away. They are 95 years old. I know that I am not entitled to inheritance. I am more concerned with my staying in the home that we have shared together for the last 30 years. 

How screwed am I?

Anxious

You can email The Moneyist with any financial and ethical questions at qfottrell@marketwatch.com.

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Dear Anxious,

There’s one thing a judge hates, especially in a divorce court, and that’s a cheat. The fact that you are disabled, and reliant on your wife financially and trusted her to make the right decision should help your case. You signed a quit-claim to transfer ownership of your house to your wife under the pretense that she would refinance it at a better rate, but it was clearly a calculated move on her part. 

You need to seek free legal aid. By telling your story to the courts, there is a high chance that you will be able to convince the judge that you signed the quit claim under duress, incompetence and/or fraud. Do not sign any more papers, including divorce papers, until you have consulted an attorney. You are not the first person to be induced to signing a quit claim with scurrilous motives, and you won’t be the last.

“With knowledge of how title to a home could impact characterization of a home, some spouses induce their partners to execute transfer deeds in order to gain an advantage in the event of divorce. These types of transactions between spouses are subject to the fiduciary relationship the law imposes on the parties upon their marriage,” according to Bickford, Blado and Botros in San Diego.


‘You are not the first person to be induced to signing a quit claim with scurrilous motives, and you won’t be the last.’


— The Moneyist

“Each spouse owes the other a duty of good faith and fair dealing,” the law firm says. “In property transactions, if one spouse secures an advantage over the other, there is a presumption of undue influence. If the court finds that there was a promise by the advantaged spouse to restore title to joint ownership in the future, the quit-claim deed or inter-spousal transfer deed may be set aside.”

The family home is not so easily usurped by one spouse through a nefarious quit-claim deed, particularly if the property was purchased during your marriage. There are no guaranteed outcomes, of course, but you should seek advice now before your wife files divorce proceedings. Your wife’s machinations may end up costing her dearly.

In fact, your wife is the one who will likely have to prove this is separate property. “In a divorce action, title is not controlling,” adds the Levine Family Law Group in Oakland, Calif. “Rather, all property purchased during the marriage is presumed to be community (i.e., joint) regardless of how title is held. It becomes the burden of the spouse who is trying to establish it as ‘separate’ to prove that it isn’t.”

“When a property purchased during the marriage is in the name of one spouse alone, and that spouse is asserting that it is separate, there is a presumption of undue influence regarding the advantaged spouse that he or she must rebut,” the law firm says. And it cannot be rebutted easily, except perhaps with a post-marital agreement. “Other than that,” it adds, “it is quite difficult.”

Call a lawyer. Sign nothing. God’s speed.

Hello there, MarketWatchers. Check out the Moneyist private Facebook  group, where we look for answers to life’s thorniest money issues. Readers write in to me with all sorts of dilemmas. Post your questions, tell me what you want to know more about, or weigh in on the latest Moneyist columns.

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