Often times at closings, customers giggle when reviewing their closing documents and see ‘a single person’; “well dang tell the world I am single, huh?” We all chuckle and move on to sign the remaining documents. While most people think this is giggle-worthy information, it is actually quite pertinent information in the state of Florida. In our share of closings, we have quickly realized how many people (lender, realtors, and customers alike) do not understand WHY we ask for marital status on transactions.
Well, I am here to tell you why: marital status is crucial when preparing real estate closing documents. Florida is a homestead state. That means spouses are protected under Florida homestead rights; which further means a property cannot be bought or sold without a spouses signature should the property be a primary residence.
So, if you are an agent who is working with a buyer to find the perfect dream home, it is important during the process to ask: 1. are you married or single? 2. If married, will you be using this property as a primary residence? 3. If yes, in Florida, spouses are required to execute the mortgage at closing, is your spouse able to attend closing to sign?
“WAIT A MINUTE, I am getting this loan by myself, married or not!” declares the buyer. And that is A-OK. The mortgage is NOT the obligation to repay the loan back to the lender. The mortgage is the security instrument that is filed as a lien on the property to secure the property as collateral to the Promissory Note. The Promissory Note is signed by the borrower only; while the Mortgage is executed by all borrowers AND non-borrowing spouses and/or title holders. We often find that many never realize there is a difference between a Note and a Mortgage. You can have only one borrower on a loan but that doesn’t perfect title when it comes to who will execute the mortgage.
If you have a buyer who further states “well I am married but haven’t seen my spouse in 20+ years”, I hate to be the bearer of bad news but this doesn’t exempt said spouse from executing the mortgage at closing. The estranged spouse will still need to either A. sign at closing or B. give a Power of Attorney to the buyer so docs can be signed on their behalf.
Their is no waiver of homestead. No form that can be signed to not require the spouse’s signature. The only way to bypass this requirement is to purchase the home A. with cash, or B. as a secondary or investment home with the lender. Let me repeat that: THERE IS NO WAY TO BYPASS REQUIRING THE SPOUSES SIGNATURE ON ANY PRIMARY RESIDENCES. I wish there was, as I know this has caused many of heartaches in the past. That is why it is so important to understand the need for marital status with real estate transactions.
In addition to confirming the details of the spouse, it is important to understand how the buyer can take title to the property at closing. If the buyer is putting the contract and loan in just their name, it is important to verify if they prefer to take title just like that or if they do in fact want their spouse added to the deed (title) as well. What’s the difference? Taking title individually is much different than as a married couple (joint tenants). In the event a buyer takes title individually, but is in fact married, and passes away; this causes the surviving spouse to go through probate to be determined as the rightful Heir to the property. However, if the buyer adds their spouse to the deed as a joint tenant, in the event one of the owners passes away, title would automatically pass to the surviving owner (spouse) once a death certificate is recorded in the public records, bypassing the need for probate on the subject property.
So that pretty much covers the buying side, but what about when the seller bought the property single and later married? Good question, I am so glad you asked! In the event that the seller has since married since obtaining ownership to the property, it is important to first ask: Is/Was this property both your primary residences? If YES, then the new spouse IS required to sign the Deed at closing relinquishing their rights to the property. Ideally, both parties should be on the contract and execute all the closing documents. Especially if this is a married couple who is together and selling the property together.
If the property was never occupied by the spouse as a primary residence, the title company or attorney can prepare a deed that states the property is not the homestead of the grantor and therefore not require the new spouse to sign any documentation at closing. Adding this clause to the deed is only recommended when the spouse has never occupied the property.
It is important that buyers and sellers understand the necessity and implications of the requirements when buying and selling. It is always strongly urged that parties seek legal advice when making decisions on who should be on title or why spouses are required to sign.
Author: Jessica E. Bennett, Licensed Title Agent
DISCLAIMER: The information provided in this article are for informational purposes only and not for the purpose of providing legal advice. The opinions expressed at or through this site are the opinions of the individual author, and may not reflect the opinions of the firm or any individual attorney.