Legal Question in Real Estate Law in California

Re: Real Property Transfer Deeds

From the lender's perspective, if they are refinancing a house in just one spouse's name only, they need title to conform to the loan documents at the close of escrow. Additionally, the title company is going to issue a lender's policy of title insurance in the refinancing spouse's name only. Regardless of whether the home was in both names originally or one name, the title company as a conservative practice will require the interspousal grant deed to eliminate any claims to title at that moment in time by the non-refinancing spouse. Same goes for the lender - if their loan is with one spouse and not the other, they do not want any wild (not as in "crazy", as in not recorded in the chain of title) claims later based on a "community property interest claim." It is not directly required by law, but it is required by both the title company and the lender if you want the loan. Post-refinance, you put the non-refinancing spouse back on title with a second interpousal grant deed. Just be sure to make a claim for exemption for reassessment by the county tax assessor when you do it, or you'll be staring down the barrell of a new property tax basis.

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Re: Real Property Transfer Deeds

If the property was originally that of only one of the spouses, then no transfer is needed as none has occurred. If both owned the property, why just have one name on the deed? The listing of names on the mortgage documents does not determine the legal vesting. Banks often require things not required by the law, and as long as it is not harmful to you, you might as well go along.