Don’t Sign That, Just Yet

Every day, we as consumers sign documents that legally bind us to do something. Sometimes it’s signing a credit card slip agreeing to pay a vendor for services. Other times it may be signing for a purchase of significant value, such as jewelry, an automobile, a home or an investment. Whatever it may be, when you attach your signature, there are consequences that you may not be aware of that can have long term and significant consequences.
Do you need to consult with an attorney, an accountant, or an investment advisor, every time you make a purchase or make changes to existing circumstances? The easy answer is, not always. But, what you should always do is, before you attach your signature and commit yourself or yourself and your spouse, to a long term financial commitment, take the opportunity to speak to someone knowledgeable, that can address your concerns and questions, educate you so that at the end of the day, you are making an informed and thoughtful decision, particularly when it comes to decisions involving life changing commitments, financially or otherwise.
All too often I hear of spouses that have made long term financial decisions without first consulting with a professional that can address the consequences.
The past fifteen years have seen the residential real estate market increase and decrease in both value and interest rates. Because of the fluctuations in the market, couples have sought to lower their interest rates (refinance) or pull equity from their homes. In a traditional household, one parent may work more than the other and because of that, the working spouse may have a better credit score and for all purposes, is a better applicant. These situations are not unrealistic or unreasonable given the circumstances, however, sometimes, to gain the best interest rates, the non-working or lesser income producing spouse is asked to transfer the home to the other spouse. Doing so may have long term consequences should either decide to file for divorce.
The term given to signing a deed and transferring the home into one spouse’s name alone as their sole and separate property is called a transmutation. A transmutation can have long term and possible determinantal consequences to one spouse, if not done properly. No one is told of these consequences when sitting before an escrow agent, with two inches of documents to sign. More often than not, because no one is planning or thinking about divorce, neither asks what are the consequences.
There is nothing wrong with asking for time to review and time to consult with a professional about the documents you are about to sign. In fact, doing so will give you peace of mind and the information you need to make a full and complete decision, with the understanding of the long time impact of what you are about to attach your signature to.
Always ask for the documents in advance so you can review them. If you do not understand something, seek out a professional that can explain to you the short and long term impact of what you are about to enter into. While in the moment, signing something may appear reasonable, rational, and in your family’s best interests to do so. However, take the time to investigate and educate yourself. Then and only then can you enter those life changing situations confident and secure with your decisions.
For more information and to schedule your consultation, please call The Law Offices of Steven B. Chroman, P.C., at 661-255-1800 or visit us at www.chromanlaw.com. Mr. Chroman is a Trusted Advisor Award Winner and named Top 100 California Attorney’s with over 24 years of experience and local service and a 2021, 2022 & 2023 Super Lawyer.