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Avoiding the pitfalls of keeping the marital home after a divorce

Of all of the possessions and types of property that can be jointly accumulated during a marriage in Texas, the most significant one is often the marital home. It's also likely to be a source of contention between couples. But there are times when one spouse offers to sell their share of the property to the other one. Even when such a move is made in good faith, there are some potential pitfalls associated with assuming sole ownership of a home that was once jointly shared.

If a home is in both individuals' names, property division of this nature typically involves what's termed a quit claim deed. The potential problem with transferring property this way is that signing over the right to ownership does not automatically change loan responsibility. If mutual loan obligations exist, the spouse owning the home may be affected by their ex's inability to pay their share of the loan. Other possible issues include undiscovered defects that could result in repairs the home-owning spouse can't afford to make.

Possible ways to avoid problems with assuming home ownership for a spouse include obtaining a new home loan and approaching the transaction as if it were between complete strangers. Doing so could make it easier to discover all related costs so they can be split equally. It's also advisable for the home-owning spouse to perform a title search, purchase a one-year home warranty policy, have the home inspected and appraised so repairs can be made, and review title, escrow, and new lender fees.

An attorney may also recommend running a second title search before a client signs home ownership transfer or new loan documents. This is because it's not unusual for previously unknown issues to pop up during the divorce process. A lawyer can also play a key role in negotiating arrangements involving other property obtained during the marriage, such as personal possessions and joint investments. However, a divorce decree will not override existing creditor agreements that may apply to one or both parties.

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