US Legal Questions about Homestead Waiver
A homestead waiver is a US-based document in which a homeowner’s spouse relinquishes his or her statuary homestead rights under applicable state laws. Mortgages in the US will require the homeowner’s spouse to sign the homestead waiver.
Once this is confirmed, there will be a foreclosure where the lender can recoup their losses up to the full loan amount.
If you don't have the waiver, then part of the property will be exempt from creditors’ claims. While homestead waivers are important for estate planning, American-based couples undergoing separation or divorce may feel unsure about the best legal recourse.
Below are some of the most commonly asked questions about homestead waivers on JustAnswer.
Can my wife, not yet legally separated, purchase a house on mortgage without my consent or signature on title?
If you purchased your house during the time you were married, then it would be considered marital property irrespective of your title, unless it had been acquired with funds received by either a gift or inheritance. Your mortgage company will require you to waive your homestead rights if your wife applies for a loan.
I decided to pursue a low interest first-lien home equity loan with just me as borrower on a house purchased prior to my marriage. However, paperwork required both me and my wife to sign as mortgagors. What are our options?
The bank may only require your spouse, who is not an owner, to sign the homestead waiver to acknowledge that she has no interest in the property. If the bank insists that your wife sign as a mortgagor, you may tell the bank that you are not willing to give your spouse an ownership interest in your property. If it is a Housing and Urban Development (HUD) loan, you may file a complaint with the HUD.
Private mortgage companies traditionally have their own set of requirements. In this case, they may want to ensure that your wife does not claim a marital interest in any “increase in value” of the property during the marriage. However, a post-nuptial agreement in which your wife waives any interest in the property should have the same effect as a homestead waiver document.
If I sign a homestead waiver, would I have no claim to property even in a community property state?
Unless your husband includes your name on the title of the house that belonged to him before your marriage, it would not be considered community property. If your husband refinances his home, the only document the lender will require of you is the homestead waiver rights you have as his surviving spouse.
In the case of a divorce, you would have no rights to the property as your name is not in the title. If your husband defaults on the refinancing loan, the lender will probably foreclose the deal as you would have no legal claim to the house.
Can I purchase a house without my spouse’s signature?
While you may purchase a house independently, the lender may require your spouse to sign a homestead waiver document if you are obtaining a mortgage for that purchase. This process will allow the lender to recoup losses if there is a loan default without worrying about your spouse’s homestead rights.
If you are not sure about your mortgage and marriage situation, then speak to a lawyer on JustAnswer today.