Does a Wife Have to Sign a Deed of Trust?

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Many Americans utilize mortgage loans to finance the purchase of a home and property. When the loan is obtained, the lender will require the borrower to sign a series of important documents, including a deed of trust. Depending on the marital status of the borrower and the laws of the state the property is located in, the wife may not need to sign the deed of trust.

Function

Mortgage lenders approve loans on the basis of the applicant's credit history, income, and cost of the home in question. When the loan is approved, the lender will require the borrower to sign a security instrument. This document is called either a mortgage or a deed of trust, depending on the state the property is located in. When a deed of trust is used, the document acts to place the property into a trust. The property will remain under control of the appointed trustee until the loan is paid in full. At that time, the borrowers will own the property free and clear. If the borrowers become unable to repay the loan, the terms of the deed of trust allow for the trustee to sell the property to recoup the loss on the loan. This process is known as foreclosure.

Signing

The deed of trust is a legal document that will be filed on record in the county system where the property is located. It will become a permanent record of the property's title, a detailed list of all the transactions that have occurred with the property. The lender requires the borrower to sign the deed of trust. The borrower is the person who applied for the loan using their income and credit scores. There can be one or more borrowers listed. Generally, a husband and a wife apply for a loan together and are considered co-borrowers. If someone else is used to get the loan approved because they have a better credit score, they are known as a co-signer.

Spousal Consent

If the wife is listed as a co-borrower or so-signer, she must sign the deed of trust. This is a requirement of the lender. Parties with financial obligations to the lender must review and sign all of the loan documents before the loan can fund. If only the husband is listed as a borrower, then there are a few scenarios that can take place. These stem from specific state laws. First, if both the husband and wife are listed as owners on the title, or the original deed, then both must sign the deed of trust even if the wife isn't borrowing. Second, if the state acts as a community property state or maintains dower or curtsey rights, the wife must sign. A nonborrowing wife will not have to sign if the state practices common-law property rights.

Considerations

Sometimes common-law property rules can be difficult to understand. Even in these states, there are exemptions that will require a nonborrowing wife to sign a deed of trust. These rules and regulations should be investigated before applying for a mortgage loan. If there is an instance of divorce, a wife may be able to claim ownership rights to a property through various laws and loopholes.

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