YOU HAVE QUESTIONS, WE HAVE ANSWERS!
VIVA ESCROW Q & A SEGMENT
(Real questions sent to us – verbatim!)
QUESTION:
I would like to add my kids to the ownership of the property. Can you help me with that?
ANSWER:
My answer is two-fold. First, I regret that we do not do transfer of ownership paperwork without it being part of a larger escrow transaction. In escrow language, we call this type of paperwork “accommodation documents.” Our Errors and Omissions insurance does not cover us unless an escrow is involved. In addition, our Regulator frowns on such a practice. There is tremendous liability to us in its preparation. Therefore, we advise our clients that there are separate document preparation companies who can help and I will refer you to them.
Secondly, how old are your kids? Keep in mind that if you add your kids and you want to either refinance or sell the property after they are added on, they will have to be a part of that transaction and sign documents. Do they have the ability to legally do so? In other words, are they 18 years or older and no longer considered a “minor?” That is the threshold in California for being “legal,” and able to sign and take responsibility for documents that they sign. A minor can acquire title to real property, but they cannot execute legal documents affecting that property.
EDUCATIONAL MOMENT:
Talking about minors acquiring title, about 20 years ago I had a transaction in which a divorced father wanted to refinance his home. In looking at the title ownership, we found it included his very young son. Apparently, in his divorce, the ex-spouse had agreed to relinquish her interest in the property but only if it went to their baby. She went ahead and deeded her interest to her son, probably with no idea what complications it would cause..Unfortunately, although the father had custody, what he did not have was legal representative capacity to act in the minor’s best interest. That capacity could only be obtained by going to court to petition for “guardianship” and this process, for that particular case, took two years to finalize. By that time, the interest rates had risen and he lost his refinance opportunity.
This is exactly the type of unintended circumstances that can happen when proper legal counsel is not obtained or insufficient thought is given to consequences certain actions may have in the future.
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~ Video of the Month ~
This is what our industry feels like.
We are being herded like ducks to conform into their approved circle.
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~ Quote of the Month ~
In commemoration of the 2025 holiday season coming up,
“Only Irish coffee provides, in a single glass, all four essential food groups:
Alcohol, caffeine, sugar and fat.”
~ Author unknown, but he was on(to) something~
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My YouTube Offering for the Month
Perhaps that divorced father with the Minor on ownership should have thought of this…
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You Have Questions? We Have Answers!
Juliana Tu, CSEO, CEO, CBSS, CEI, SASIP
Escrow is my FOREMOST language!
Advance Disclosure:
The opinions expressed in this blog are solely the author’s.
Your comments and viewpoints are always welcome.
Info @ VivaEscrow.com