With a persons house being one of the largest assets most people own, it is important that the house be set up as community property where both parties get one-half of the equity in the house upon any separation. There is though, situations where property is given up by spouses when a disclaimer deed is signed at the purchase of the house. Generally,this is to separate the property from the community property in the marriage.
Disclaimer Deed in Arizona
In Arizona, property is characterized as either community or separate. The characterization of that property is determined at the time it is purchased. Property acquired before marriage is that spouse’s separate property if characterized in writing. Property acquired during the marriage is presumed to be community property. Upon a divorce in Arizona, the courts are required to divide community property equitably, which for the most part means equally. In situations where there is a disclaimer deed on a property, that property is not put in to consideration when separating the common equity of the relationship. It is very important that the signing party in the state of Arizona think carefully prior to signing a Disclaimer Deed.
Reasons for a Disclaimer Deed
There are two primary reasons for a Disclaimer Deed: The first is credit worthiness for a mortgage. Many couples opt for a disclaimer deed when applying for a mortgage, and one party has a much better credit score than the other and the mortgage company offers the one party an out from being attached to the mortgage and the property. The most common reason is property inherited and or purchased prior to the marriage that the couple agrees will not be part of their joint community, these cases of community property are looked at differently state by state, but for the most part, the State of Arizona would look at a Disclaimer Deed as giving up rights to a separate property.