Divorces with significant property can easily become messy, as spouses may do things that are uncharacteristically cruel or unethical. For example, someone who has never taken an issue with supporting the family may come to resent the financial demands of their ex as they negotiate a co-parenting arrangement and a property division settlement.
People might intentionally hide assets from the courts or diminish their shared resources all in the hopes of denying their spouse certain property. Sometimes, unethical behaviors can have a trickle-down effect that impacts the next owner of the property in question.
If you buy a home sold by someone who recently divorced, there could eventually be title issues related to the divorce and the transfer of the property. You could eventually find yourself facing an expensive title claim brought by the spouse who didn’t sell you the house.
Spouses should comply with court orders for property division
It is a common practice for the courts to award a marital home to one spouse or to authorize the sale of the property so that the spouses can share the proceed of the sale. Sometimes, possibly because they are partner is not on the title for the property, one spouse will transfer the home without consulting their spouse who may have an interest in the property or without sharing the proceeds of the sale with them. Other times, someone without a vested interest in the property will try to sell it using a quitclaim deed.
In scenarios where the conveyance of the property was fraudulent or at odds with the property division decree issued by the family courts, the result could very well be a title claim brought by the spouse deprived of their interest in the property.
A title claim can be expensive even when unsuccessful
If you have to go to court to defend your ownership interest because someone else contests the validity of the transaction where you purchased the property, you may have to invest thousands of dollars in your defense of your home.
Your title insurance coverage could potentially help pay for your lawyer costs and court fees. Of course, it is always better to identify and handle before the closing table. Realizing that there may be a title issue with your property can help you address these concerns before you reach the closing table or at least resolve them outside of court.