Protect your home with a prenup
Dear Len & Rosie: I am a single mom, engaged to be married. I also own a house that I am making payments on. My daughter, who is 25 years old, is on the title of the home with me as joint tenant. I do not want to do a prenup, but I want to make sure my children inherit my home if something should happen to me. Is there anything I need to do? Would a trust protect them? – Sherry
Dear Sherry: Even though you do not want to enter into a prenuptial agreement with your fiancé, it’s probably best that you do so anyway. The reason you need a prenup is because you haven’t completed the purchase of your home. When you get married, your paycheck will be community property, half owned by your husband. When you use your earnings to make your monthly home loan payments, you will be spending community property to buy property titled in your name alone. Despite the fact that your husband’s name will not be on the title to the home, he will have a legally valid claim against part of its equity, because everything purchased with community property is community property, regardless of how it is titled.
If you want to make sure your husband won’t be able to claim partial ownership of your home upon your death or a divorce, you need to do one of two things. Either you need to use only separate property to pay off your home loan, or the two of you need to enter into a prenuptial agreement that declares your earnings to be your sole and separate property, or at least declares that your home will remain your separate property even if community property is used to purchase it.
If you create a prenuptial agreement, both you and your fiancé must have your own independent attorneys. This may seem wasteful, but it’s necessary. In California, there is a strong legal presumption that a prenuptial agreement is invalid unless both parties have their own lawyers advising them as to what rights they are giving up by entering into the agreement. It may be bothersome for you to create a prenup, but it is really the only way you can guarantee that your future husband won’t try to take part of your home away from your children.
Speaking of your children, you have another problem. If your home is in joint tenancy with only your daughter, when you pass away, your daughter is going to own your home (except for whatever claim your husband may make). Your other children won’t inherit any of it, regardless of what your will or trust says. If you want to make sure that all of your children inherit your home equally, the home should be in joint tenancy with all of them, or you should get your daughter to sign the home back over to you. Then, you can create a trust to divide the home up the way you want after your death.- Len & Rosie
Len Tillem and Rosie McNichol are elder law attorneys. Contact them at 846 Broadway in Sonoma, at 996-4505, or Lentillem.com. Len also answers legal questions each weekday, 3 to 4 p.m., on Newstalk 91 AM.