After a divorce is settled, both former spouses will have an obligation to transfer marital property to each other according to the terms of the divorce decree. What many people fail to understand is that the divorce decree doesn’t actually transfer legal ownership of property from one person to another—while both parties are legally obligated to follow the terms of the decree, transferring legal ownership often requires additional documentation.

For instance, a divorce decree may say that the husband will receive ownership of the family vehicle, while the wife will receive ownership of the family home. While both the husband and wife have a legal duty to transfer these pieces of property, the divorce decree itself does not achieve this goal. Instead, the wife will have to transfer her ownership interest in the car to her former husband, and the husband will have to transfer his ownership interest in the house to his former wife.

When dealing with property like a vehicle, this is usually done by signing over the property to the other person. An ownership interest in real estate, however, is much more complicated.

When two people sign a mortgage, they are both equally obligated to make the payments. The divorce decree does not change this obligation, and the family court judge has no power to order the mortgage company release one spouse from the mortgage. Instead, the person who retains ownership of the house will have to negotiate directly with the lender and refinance the mortgage in order to remove his or her former spouse’s name.

The mortgage company will often have no interest in removing a person from a large loan, especially if the spouse keeping the house cannot afford the property by themselves. Many people believe that they can get around this problem by signing a document called a quitclaim deed. That belief is incorrect.

When dealing with real property like a house, there are two types of deeds: warranty deeds and quitclaim deeds. Warranty deeds say that the person selling his or her interest owns the property free and clear and is transferring the house without any liens or encumbrances on the title. In contrast, quitclaim deeds make no such guarantee; while the person still transfers his or her interest in the property, he or she is doing so while stating that there may still be liens, mortgages, or other outstanding financial obligations attached to the property.

When former spouses use a quitclaim deed to transfer property, all the person signing the deed is doing is giving up his or her right to the property. If there is a mortgage attached to the property, the mortgage does not change. The person who signed the quitclaim deed is still responsible for making payments, but is no longer legally entitled to use the property or sell it.

As a result, quitclaim deeds are only useful in limited circumstances. Quitclaim deeds are generally used to transfer property rights after a mortgage has been refinanced. Until that point, signing a quitclaim deed too early could lead to legal headaches later on.

For all of these reasons, it is important to come up with a course of action for real property both during and after a divorce. If a property needs to be sold or refinanced, it is often easier to put the divorce on hold until that process is successful. If that is not possible, then both parties need to be clear about their obligations to the property after the divorce.

Fairly and accurately dividing property and debts in a divorce case often requires the help of a skilled Washington family law attorney. The lawyers at Pacific Northwest Family Law have many techniques at their disposal to help divorcing couples split marital property in an equitable way, and achieve great successes using mediation, collaboration, and other dispute resolution methods.

For an initial interview or to learn more about dividing marital property in a divorce, contact us today by calling 360-926-9112.