Hi,
I have rental properties from before marriage that I have maintained as separate. I’m looking to refinance with cash out to buy additional rental properties. If I’m only using money from these refinances as down payments on new properties, no marital funds, will the new properties automatically be my separate properties? Is a free trader agreement enough to protect me, or do I need a post-nup specifying what happens with the existing and future properties?
I may purchase properties outside of NC if that makes a difference. Also, my marriage is on rocky grounds.
Thank you
If you have real property that is entirely separate property (acquired before the date of marriage and maintained with separate funds), and then you refinance and use the cashout money to purchase new real properties, the new real properties will remain your separate property if they are titled in your name only, subject to the note below about mortgages.
A free trader agreement is sufficient for your spouse to waive his/her marital interest in the properties.
Note that separate property real estate that has a mortgage that is paid each month during the marriage with marital funds, will make a portion of the separate property marital property. The marital value of separate property real estate is the amount of principal that has been paid on the separate property mortgage during the marriage.
Anna Ayscue
Attorney with Rosen Law Firm Cary • Chapel Hill • Durham • Raleigh • Wake Forest
Rosen Online | Unlimited confidential access to a North Carolina attorney for $199/mo - click here
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