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Barrister
Barrister, Lawyer
Category: Real Estate Law
Satisfied Customers: 33746
Experience:  15 years real estate, Realtor. Landlord 26 years
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I have been served papers on a lawsuit in Arizona loan I

Customer Question

Hi there...I have been served papers on a lawsuit in Arizona for a loan for which I made a personal guarantee. The loan amount is $1.5M and has three guarantors, of which I am one. The two other guarantors are residents of Arizona. My primary asset is my California residence which has about $1.3M in equity and, although I am married, the title is currently only in my name. Currently, I am living and working in Mexico and the home is rented for the next 12 months.
With that as context, here is my question...is there any benefit to adding my wife to the title? Under California law will that help to protect the asset from any collection efforts?
Submitted: 1 year ago.
Category: Real Estate Law
Expert:  Barrister replied 1 year ago.

Hello and welcome! My name is ***** ***** I will try my level best to help with your situation or get you to someone who can.

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is there any benefit to adding my wife to the title? Under California law will that help to protect the asset from any collection efforts?

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If this is an unsecured judgment that will be granted against you and the others for a default on the loan, then adding wife to the deed would not really have any benefit as she would already be liable due to the nature of CA being a community property state. Further, any homestead exemption for your home would already be based on the fact that you are married, but would exempt a max of $175K in equity in the home under CA law. However, it wouldn't apply since you are renting it and it is not your principle place of residence.

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So the amount of equity that you have in the home will make it a prime target for creditors as none of the equity in the property will be protected..

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I am very sorry that I don’t have better news, but please understand that I do have an ethical and professional obligation to provide customers with legally correct answers based on my knowledge and experience, even when I know the answer doesn’t make the customer happy...

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thanks

Barrister

Customer: replied 1 year ago.
What if I transfer the property to my wife as part of a divorce settlement?
Expert:  Barrister replied 1 year ago.

If the debt was incurred while married, then she is equally liable for it, whether you are married or not. So unfortunately transferring the property wouldn't protect it.

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I am sorry that the news isn't better..

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thanks

Barrister

Customer: replied 1 year ago.
I'm told that California law has some specific twists...is this opinion based on California law?
Expert:  Barrister replied 1 year ago.

Yes, that is why JustAnswer asks where the customer is located.. Giving information based on another state's laws wouldn't really be helpful to the customer... CA makes it tough on married debtors because of the community property laws that make all assets and debts acquired during marriage jointly owned with the exception of inheritances and gifts..

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thanks

Barrister

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