Legal Question in Real Estate Law in New Jersey

who owns this property?

Both husband and wife received a mortgage for a home, but at closing only one spouse's name appears on the deed.

What does this mean?

Asked on 10/28/06, 4:59 pm

2 Answers from Attorneys

Beverly Muller Beverly Sharps Muller, Esquire

Re: who owns this property?

hi -

only the spouse whose name is on the deed owns the property, even if both are on the mortgage. if you have any other questions, call me at 609.263.0089. good luck ! beverly

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Answered on 10/28/06, 5:03 pm
John Corbett Corbett Law Firm LLC

Re: who owns this property?

This may mean that there is an important error in the documents.

I am guessing that the parties were not represented by a lawyer at closing. Otherwise, you would have asked the question of that lawyer. The situation is yet another example of why people should not handle their own (real property) transactions unless they are knowledgeable in the law and experienced in such transactions.

The technical answer to your question is that only one spouse holds title to the property but both spouses have pledged their interest in the property as security for the debt. You might ask how an interest can be pledged if it doesn't exist. Good question. It might exist in the future such as if the other spouse dies and the property interest is acquired that way. The lender is protected, the unnamed spouse is not.

Take another look at the promissory note. If that names both spouses, it means that both owe the money, but only the spouse named on the deed owns an interest in the real property. That is a very bad situation because if something happens to the other spouse or the marriage, the spouse who is not on the deed will lose out. Consider also that the spouse named on the deed can sell the property without the other's knowledge and without sharing the proceeds of the sale.

Bear in mind also that there are distinct advantages for spouses in NJ to take title to the maritial home together, in equal parts, and at the same time. If this happens, the law will assume that they are "tenants by the entirety." In that ownership state, one spouse's interests cannot be attacked by the other spouse's creditors. Thus, the maritial home is protected.

There are occasions where the arrangement you describe might be done intentionally by the buyers. I don't think that is the situation here. If it is an error, it is an important error that affects the rights of the parties and it should be corrected as soon as possible. If the buyers were represented by a lawyer, that lawyer will probably have the error corrected at no cost to the buyers.

If I can be of further help, email me at the address in my Attorney Profile.

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Answered on 10/28/06, 5:56 pm

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