How do I buy a home behind my wife's back?
Dear Real Estate Adviser,
I'm in my mid-50s and unhappily married. I'd like to start preparations for buying a house and I want to purchase it very soon without my wife knowing. Is this possible? And if so, how do I proceed?
-- Mike Z.
There are a handful of ways you could buy a home behind your wife's back, but they are pretty shady and the risk would probably outweigh possible benefits.
In community property states, which include Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin (plus Puerto Rico), your wife would still have a 50-50 interest in the property if you purchase it during your marriage, with a few possible exceptions.
If the money you'd use to buy a house comes directly from an inheritance or other gift that was passed solely to you, or from separate premarital assets that you've legally protected, you might be able to proceed.
What trumps your efforts in nearly every U.S. jurisdiction, however, is the overriding illegality of hiding assets from a spouse for the purpose of property division. That alone should be ample deterrent unless you've got a strong alternative legal position of some sort. Any evidence of deceit, by the way, is also frowned upon in divorce court and typically raises questions about other hidden assets or duplicity. And of course, if you and your spouse file taxes jointly, you'd be hard pressed to try to claim any tax benefits on a secretly purchased house without raising a red flag.
Alternatively, you could try to buy a house under some kind of limited liability corporation and shield it as a business asset. But you had best seek advice from a CPA or attorney because this is also risky. Or you might be able to skirt these laws entirely by having a trustworthy family member buy a house using your money (all cash from the aforementioned protected assets) then agree to convey the house to you when you're finally divorced. If you do this, be sure keep thorough records of the money trail to avoid charges that you've raided community property. Technically, you could get financing for a loan that's solely in your name, using just your income, though lenders hesitate to get mixed up in potential divorce disputes.
You might, however, be able to accelerate the process and buy a house (without deceit) immediately after the divorce filing if you add a proviso stating your wife has no financial rights to any assets you each acquire after a set date -- and can get her to go along with that.
You don't say why you want to buy a house now instead of later, though I conjecture it might be because values are rising where you are and may be considerably higher by the time your divorce is final. Regardless, you are playing with fire when you acquire such a large asset clandestinely while still married.
Hence, you just might have to bite the bullet here and go through proper -- albeit delayed -- channels, lest you dig yourself an even deeper hole than the typical divorce-related financial abyss.
Ask the adviser
To ask a question of the Real Estate Adviser, go to the "Ask the Experts" page and select "Buying, selling a home" as the topic. Read more Real Estate Adviser columns and more stories about mortgages.