Tuesday, September 7, 2010

You want to add the name of the person you live with to your deed and mortgage? Now you can.

Is an explanation of a long hiatus in blogging necessary? I took a long summer vacation and then there were all those just-getting-back-to-work efforts (and the Lavender Law conference). But it's the day after Labor Day, a traditional day for new beginnings (to be followed shortly by the Jewish New Year tomorrow night), so this is a great day to resume, and I get to do it with good news.

Lambda Legal has settled a case on behalf of a lesbian couple who faced foreclosure when one partner added the name of the other to her deed. In 2005, Countrywide Mortgage told Adola DeWolf that, because her partner Laura Watts was not a member of her family, the addition of Watts to her deed was grounds for calling in the mortgage. Had the couple been unable to refinance within 30 days, DeWolf would have faced foreclosure and the couple could have lost their home. Lambda filed suit in 2007 alleging violating of the Equal Credit Opportunity Act which prohibits discrmination on the basis of marital status.

In my 2008 book, Beyond (Straight and Gay) Marriage, I criticized Lambda's messaging of the DeWolf case. The original press release turned the case into a call for marriage equality by saying that had the couple been able to marry they would not have been mistreated. Lambda also called for home loan lenders to "treat unmarried same-sex couples as they do married different-sex couples." I criticized this spin because federal law bans marital status discrimination and should therefore protect all unmarried couples, gay or straight. No one should have to get married to add a partner's name to a deed and mortgage, and I thought that should have been the message around the case.

Well Lambda has done better than achieve equality for all couples, married or unmarried. After negotiations with Fannie Mae (whose policies, according to Countrywide, required their action against DeWolf), Lambda has announced that Fannie Mae will now allow a homeowner to add the name of anyone who will live in the home to the deed and mortgage. That's a great result because it doesn't privilege couples of any sort, married or unmarried, over any other people who choose to live together and share the ownership of and financial responsiblity for a home. So a couple need not marry and others who want to live together and pool resources, like close friends or two single moms, can also add a name to a deed and loan without discrimination.

This Lambda victory is a "beyond marriage" victory. Congratulations all around.


Bill Singer said...

But couples whose relationship or marriage is not recognized by the federal government could still be subject to gift tax issues when they put their partner's/spouse's name on the deed

Nancy Polikoff said...

Quite true! That will take a different law reform effort. I would prefer a result that allowed for no tax consequences as long as the person was in fact making the home his/her primary residence. The law should be neutral about whether a homeowner decides to share a life with a spouse, a nonmarital partner, a sibling, or a close friend.