Home Refinancing During Separation and Divorce: What You Need to…
What is a Free Trader Agreement and do I Need One for My Divorce?
Free Trader Agreements are something we often get asked about as divorce attorneys in North Carolina. Our clients want to know what a Free Trader Agreement for Divorce are and whether they need one.
What is a Free Trader Agreement?
A Free Trader Agreement is a document that allows a spouse to sell property in his or her individual name without the other spouse having to sign the deed. The Free Trader Agreement may also allow a spouse to purchase property in his or her individual name without the other spouse having any inchoate marital interest or other rights to the property. Free Trader Agreements are typically needed after a separation and prior to a divorce.
In North Carolina, without this Free Trader Agreement, if you are legally separated but not yet legally divorced, you cannot transfer a deed to another person without your spouse’s signature.
Further, if you can qualify to purchase property in your individual name prior to your divorce, there is a chance that your spouse has an inchoate marital interest or inheritance rights in the property. Due to this, most attorneys recommend that the parties sign Free Trader Agreement or wait until the divorce finalized before purchasing real estate.
A Free Trader Agreement is important because North Carolina requires a waiting period of 12 months from the date of separation until a divorce can be filed. This can put plans for refinancing, purchasing, or selling real estate on hold until this period is over, and most spouses will need to start searching for alternative housing well before the 12-month time period has passed.
Free Trader Provisions and Separation Agreements
Most family law attorneys in North Carolina will include some type of Free Trader provision in a separation agreement. If properly executed, this can be enforceable. Without a separate recordable Free Trader Agreement, you will have to record your entire separation agreement with the Register of Deeds office. While this may not seem like a big deal, the Register of Deeds charges you by the page, so the longer a document is, the more costly it is to file. These records are also public once filed, and many people do not want their personal life open for the world to see.
Due to this, we recommend that you have a separate Free Trader Agreement that can be filed with your local Register of Deeds office. Alternatively, you can file a Memorandum of Separation Agreement, which refers to the fact that you have a duly executed separation agreement that includes a Free Trader Agreement, but does not publicly disclose the details of your private separation agreement.
Contact an Experienced North Carolina Family Law Attorney Today
If you are not sure whether you need a Free Trader Agreement in order to purchase, sell, or refinance property after your separation, but prior to your divorce, then contact the attorneys at Helms, Robison, Lee & Bennett, P.A. today to discuss your options.Back to all blog posts