Equal division of real property, such as the marital residence, in a California divorce often means the home is sold and proceeds divided according to the court's instructions. This is especially true if there is a mortgage on the property that both spouses are responsible for. However, it is possible to relinquish title and financial responsibility for the property, effectively allowing your spouse to buy you out of the jointly owned real property.
Negotiate with your spouse. Agree that he will retain the marital home by taking title and assuming full financial responsibility. In exchange, agree that he will pay you one-half of the home's current value - your share of the marital property. Alternatively, he can compensate you with other marital property of the same value.
Read More: How to Remove a Name From a Property Title
Agree how the current mortgage will be paid while you wait for your spouse to qualify for a mortgage in his name alone. You may need to continue paying half the mortgage until his closing as both of you continue to be responsible for payment, in the eyes of the lender, until your spouse closes on his own mortgage.
Execute a quitclaim deed to your spouse. In a quitclaim deed, you relinquish all ownership rights in the property to your spouse. You can obtain a quitclaim deed form from your county assessor's office or from an online legal document provider. Complete the form according to the instructions provided. In California, requirements for a quitclaim deed vary from county to county, but generally the relinquishing spouse must sign it before a notary and have it notarized, which includes providing a thumbprint.
Inform your spouse that the California Revenue and Taxation Code requires him to file a Preliminary Change of Ownership Report with the assessor's office in the county where the property is located. Obtain the form from the county assessor's office. The retaining spouse must fill it out according to its instructions, sign it before a notary and have it notarized.
File the quitclaim deed and Preliminary Change of Ownership Report with the county recorder's office. Either party may file the documents. A filing fee may be required at the time of filing. Regardless of which spouse files the documents, he or she should request file-stamped copies of both documents for each spouse's personal records. If the Preliminary Change of Ownership Report is not filed with the quitclaim deed, it must be filed within 90 days of its execution.
Execute the Change of Ownership Statement sent by the county assessor's office if one is received. Usually the assessor's office only sends out a Change of Ownership Statement if the Preliminary Change of Ownership Report is incomplete or not filed correctly. Fill out the statement according to its instructions and send it back to the county assessor's office.
Wait to relinquish title until your spouse closes on his own mortgage. This avoids any possibility of your spouse taking full title while failing to follow through on assuming financial responsibility for the home. You don't want to remain on the hook for a mortgage when you no longer own any part of the property.
- California State Board of Equalization: Change in Ownership - Frequently Asked Questions
- Sacramento County Public Law Library: Frequently Requested Forms
- Sacramento County Assessor's Office: Preliminary Change of Ownership Report
- The Easy Deeds, LLC: California Quit Claim Deeds
- Law Office of Peter Cameron, APC: What is a California Quitclaim Deed?
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