15.2.7 Mortgages and Other Consensual Liens on Home

125 Vogel v. Veneman, 276 F.3d 729 (5th Cir. 2002) (Tex. law) (homestead exemption does not apply to refinancing of original purchase money debt); In re Anderson, 308 B.R. 25 (B.A.P. 8th Cir. 2004) (Minnesota homestead exemption does not protect against voluntary liens); United States v. Berk, 374 B.R. 385 (D. Mass. 2007) (homestead exemption does not protect against mortgage); In re Liberman, 244 B.R. 557 (E.D.N.Y. 2000) (New York homestead exemption does not protect against foreclosure of purchase money mortgage), aff’d, 225 F.3d 646 (2d Cir. 2000) (table; text available at 2000 WL 1340520); In re Laird, 2010 WL 1664079 (Bankr. M.D. Ala. Apr. 22, 2010) (homestead does not protect against validly executed second mortgage; if homestead mortgage formalities complied with, no need for waiver of homestead procedure provided by another statute); In re Wycuff, 332 B.R. 297 (Bankr. N.D. Ohio 2005); In re Evans, 2005 WL 3845700 (Bankr. N.D. Fla. Dec. 21, 2005) (Florida homestead exemption does not protect against mortgage, and bankruptcy discharge eliminates only personal liability; foreclosure permitted after discharge); In re St. Onge, 317 B.R. 39 (Bankr. D.N.H. 2004) (second mortgage will encumber homestead if signed by both spouses with formalities required for conveyance of land); In re Desroches, 314 B.R. 19 (Bankr. D. Mass. 2004) (homestead exemption subordinate to second mortgage signed by both spouses with words of grant and mortgage covenants, even though it did not explicitly release homestead); Mirzataheri v. FM E. Developers, L.L.C., 193 So. 3d 19 (Fla. Dist. Ct. App. 2016) (homestead exemption, which protects only against forced sale, does not bar claim for specific performance by real estate purchasers against sellers who refused to close; sellers had signed contract explicitly providing for that remedy); Homeside Lending, Inc. v. Miller, 31 P.3d 607 (Utah Ct. App. 2001) (consensual lien created by refinancing was not subject to homestead exemption); Upton v. Household Fin. Indus. Loan Co., 6 P.3d 1231 (Wash. Ct. App. 2000) (deed of trust beneficiary’s interest in real property and its proceeds is superior to homestead exemption). See also Abir v. Stern, 2010 WL 1170060 (E.D.N.Y. Mar. 22, 2010) (no homestead exemption in proceeds of bankruptcy trustee’s sale of homestead when proceeds used to pay off consensual mortgage); In re Stepka, 425 B.R. 820 (Bankr. D. Minn. 2010) (no homestead exemption after bankruptcy trustee invalidated mortgage because of defective property description; debtors intended to, and voluntarily did, grant mortgage); In re Trustee’s Sale of Real Prop. of Ervin, 134 Wash. App. 1047 (Wash. Ct. App. 2006) (second mortgage takes priority over homestead exemption in distribution of proceeds of first mortgage foreclosure). But see United States v. Neff, 2007 WL 776532 (D.N.D. Mar. 12, 2007) (North Dakota forbids waiver of homestead exemption for chattel debt). See generally §§ 13.1 (consensual liens on property other than home), 13.3.9, supra (waiver of exemptions).

126 See, e.g., Iowa State Bank & Tr. Co. v. Michel, 683 N.W.2d 95 (Iowa 2004) (allowing exemption because lender failed to comply with Iowa procedure for waiver of homestead exemption by consensual mortgage of agricultural land); Earls v. Chase Bank of Tex., 59 P.3d 364 (Mont. 2002) (mortgage void where regulated lender failed to obtain written waiver of homestead rights required by former Montana statute).

127 See, e.g., Cavazos v. Munoz, 305 B.R. 661 (S.D. Tex. 2004) (mechanics lien was good, as to homeowners, where contractor complied with all procedural requirements except the lien affidavit, which serves to protect third parties); Chase Manhattan Mortg. Corp. v. Cook, 141 S.W.3d 709 (Tex. App. 2004) (bank failed to prove that loan was used to pay off mechanic’s lien, so lien on homestead not permitted by Texas law). But cf. In re Fakhari, 545 B.R. 303 (Bankr. D. Kan. 2016) (homestead exemption statute’s exception for obligations arising from “erection of improvements” to homestead did not cover roof repairs because contractor “did not erect anything”); In re Sorrell, 292 B.R. 276 (Bankr. E.D. Tex. 2002) (falsified mechanic’s lien documents did not override homestead exemption); Cross v. Strader Constr. Co., 768 So. 2d 465 (Fla. Dist. Ct. App. 2000) (contractor’s judgment in quantum meruit not a mechanic’s lien so it does not fall within exception to homestead exemption).

128 Knolls Condo. Ass’n v. Harms, 781 N.E.2d 261 (Ill. 2002) (homestead exemption not a defense against eviction action brought by condominium association for unpaid fees).

129 Brooks v. Northglen Ass’n, 141 S.W.3d 158 (Tex. 2004) (fees imposed by covenants running with land and in effect at time of purchase may be enforced by foreclosure on homestead, but increased fees allowed by statute may not).

130 See, e.g., Mohn’s Inc. v. Wilson, 475 B.R. 674 (E.D. Wis. 2012) (broadly construing Wisconsin homestead law’s exception for debt for “purchase price” to include homebuilder’s claim for work done in constructing house); In re Zahina, 2016 WL 2865264 (Bankr. N.D. Iowa May 11, 2016) (purchase money exception applies to home being purchased by contract for deed); Spikes v. OneWest Bank, 106 So. 3d 475 (Fla. Dist. Ct. App. 2012) (purchase money exception applies to equitable lien on interest of wife who had been present at closing but was “inadvertently” not asked to sign); Barras v. Barras, 396 S.W.3d 154 (Tex. App. 2013) (equalization payment to ex-wife for her share of home awarded to husband was purchase money debt, for which lien may be imposed on homestead). See also In re Rubino, 2004 WL 1701105 (Bankr. N.D. Iowa May 28, 2004) (Iowa homestead exemption does not protect against debt “incurred for work done or material furnished exclusively for the improvement of the homestead,” here semi-permanent above-ground pool).

131 See, e.g., In re Hartley, 483 B.R. 700 (Bankr. W.D. Wis. 2012) (discussing allocation of equity and mortgage debt on parcels formed by splitting large mortgaged parcel into homestead and non-homestead parcels; giving decisive weight to Wisconsin requirement that debt be satisfied first from non-homestead property); In re Timmer, 423 B.R. 870 (Bankr. N.D. Iowa 2010) (creditor must proceed against business real estate before homestead); In re Wade, 354 B.R. 876 (Bankr. N.D. Iowa 2006) (Iowa homestead real estate may be pledged but may be sold only if deficiency remains after all non-homestead collateral is sold).

132 See also § 13.3.5, supra (marshalling).

133 ALABAMA: Ala. Code § 6-10-3. See Clark v. IndyMac Mortg. Servs., 2014 WL 122463 (N.D. Ala. Jan. 13, 2014) (Alabama’s two-signature rule applies only if property occupied as homestead on day mortgage was signed); Phillips v. Fuller, 814 So. 2d 885 (Ala. Civ. App. 2001) (homestead not abandoned by wife who fled from abusive husband; mortgage invalid without her signature); But cf. James v. Thaggard, 795 So. 2d 738 (Ala. Civ. App. 2001) (husband could not avoid mortgage on grounds that wife had not signed, when she lived, worked, and claimed a homestead on a residence in another state and had never resided on the mortgaged property).

ALASKA: Alaska Stat. § 34.15.010. See Richardson v. Estate of Berthelot, 2013 WL 203271 (Alaska Jan. 16, 2012) (Alaska law gives non-signing non-titled spouse one year to challenge deed of trust; right survives signing spouse’s death; allowing wife to invalidate deed of trust and claim her homestead allowance from estate); Nat’l Bank of Alaska v. Ketzler, 71 P.3d 333 (Alaska 2003) (if non-signing spouse’s name is on title, one-signature deed is void on its face; otherwise non-signer must sue within one year). But see Gottstein v. Kraft, 274 P.3d 469 (Alaska 2012) (when couple were separated and neither was residing in former marital home, it was not a “family home or homestead” within the meaning of two-signature statute).

FLORIDA: Fla. Const. art. X, § 4(a)(1)(c). See In re Miller, 352 B.R. 908 (Bankr. M.D. Fla. 2006) (under Alabama law purported conveyance of homestead property, signed by only one spouse, was entirely void, not just as to amount of homestead exemption); Taylor v. Maness, 941 So. 2d 559 (Fla. Dist. Ct. App. 2006) (contract of sale, signed by owner-husband but not non-owner wife, could not be enforced by specific performance; wife not tortiously interfering with contract because homestead law gave her “absolute legal right” to refuse). But cf. Spikes v. OneWest Bank, 106 So. 3d 475 (Fla. Dist. Ct. App. 2012) (allowing foreclosure of equitable mortgage when non-signing wife was present at closing and willing to sign but was inadvertently not asked to do so).

IOWA: Iowa Code § 561.13. See Martin v. Martin, 720 N.W.2d 732 (Iowa 2006) (one-signature deed void even though parties were in process of getting divorce, and home was owned by husband before marriage and was awarded to him in divorce); Beal Bank v. Siems, 670 N.W.2d 119 (Iowa 2003) (if at time mortgage is signed, married owner resides on property and claims homestead, both spouses must sign, even if other spouse neither resides nor claims homestead there); In re Estate of Battle, 778 N.W.2d 218 (Iowa Ct. App. 2009) (refusing to reinstate original mortgage loan when cash-out refinance loan that paid it off was void for lack of spousal signature; giving weight to bank’s negligence in failing to obtain wife’s signature); Citimortgage, Inc. v. Danielson, 771 N.W.2d 653 (Iowa Ct. App. 2009) (mortgage void for lack of spousal signature; equitable mortgage not available because no proof of fraud). See also Wells Fargo Bank v. Hudson, 742 N.W.2d 605 (Iowa Ct. App. 2007) (Iowa strictly enforces two-signature rule).

KANSAS: Kansas Const. art. 15, § 9; Kan. Stat. Ann. § 60-2303. See U.S. Bank N.A. v. McConnell, 305 P.3d 1, 12 (Kan. Ct. App. 2013) (wife validly waived homestead by signing mortgage even though she did not sign note secured by mortgage). But cf. In re Cox, 408 B.R. 407 (Bankr. D. Kan. 2009) (allowing equitable lien; wife’s statutorily required signature on mortgage was forged, but strong evidence that wife knew of, agreed to, and received the benefits of the refinancing).

MICHIGAN: Mich. Comp. Laws § 600.6023(1)(g). But cf. Bullard v. IndyMac Bank, FSB, 539 Fed. Appx. 665 (6th Cir. 2013) (Mich. law) (spousal signature not needed when wife owned property before marriage and never granted it to husband; without ownership, husband had no ownership right).

MINNESOTA: Minn. Stat. §§ 507.02, 507.03. See Wells Fargo Home Mortg., Inc. v. Dietz, 2005 WL 758595 (D. Minn. Mar. 30, 2005) (purchase money mortgage signed by only one of two joint tenants—here, a married couple—does not confer rights in non-signing spouse’s interest; creditor entitled to only half of sales proceeds); Marine Credit Union v. Detlefson-Delano, 830 N.W.2d 859 (Minn. 2013) (husband’s deed granting “all title right and interest” to wife not sufficient to eliminate homestead when it did not include explicit waiver of his homestead rights, so subsequent mortgage signed only by wife was void for lack of husband’s signature); Nat’l City Bank v. Engler, 777 N.W.2d 762 (Minn. Ct. App. 2010) (wife’s signature as “non-borrower . . . for the purpose of waiving any and all homestead rights” sufficient to comply with two-signature rule for mortgage of homestead); Peterson v. Lenz, 2004 WL 2793331 (Minn. Ct. App. Dec. 7, 2004) (waiver of homestead filed while divorce pending, to enable wife’s lawyer to file attorney’s lien, was invalid without husband’s signature); Wells Fargo Home Mortg., Inc. v. Chojnacki, 668 N.W.2d 1 (Minn. Ct. App. 2003) (two signatures required on all except purchase money mortgages; loan secured by manufactured home was not purchase money, when part of proceeds paid off seller’s lien; creditor failed to show ratification by non-signing wife; mortgage was void); Wells Fargo Home Mortg., Inc. v. Newton, 646 N.W.2d 888 (Minn. Ct. App. 2002) (specific requirement for both spouses’ signatures on mortgage of homestead trumps general provision of married women’s act allowing wife to manage separate property; wife’s attempt to mortgage homestead without husband’s signature invalid, but wife liable on promissory note); Peterson v. Hinz, 605 N.W.2d 414 (Minn. Ct. App. 2000) (attempt to impose attorney’s lien on homestead property, when wife had not signed the homestead waiver, was frivolous).

MISSISSIPPI: Miss. Code Ann. § 89-1-29. See In re Ramsey, 424 B.R. 217 (Bankr. N.D. Miss. 2009) (spousal signature requirement cannot be waived, and omission cannot be cured by later action; deed of trust void and equitable mortgage denied, even though signing spouse lied and forged a signature); In re Rhymes, 2008 WL 723975 (Bankr. S.D. Miss. Mar. 14, 2008) (deed of trust encumbering homestead void for lack of wife’s signature, even though she conveyed her interest in land to husband before he signed); Countrywide Home Loans, Inc. v. Parker, 975 So. 2d 233 (Miss. 2008) (couple resided in house owned by wife; she refinanced without husband’s signature, falsely stating that they were separated; deed of trust was void, and lender not entitled to equitable mortgage); Snoddy v. Snoddy, 791 So. 2d 333 (Miss. Ct. App. 2001) (house became homestead when couple lived there during marriage, even though it was separate property of husband; husband’s attempted conveyance was void when wife did not sign); Thurman v. Thurman, 770 So. 2d 1015 (Miss. Ct. App. 2000) (if couple are married and living together, valid deed of trust requires both signatures). But cf. Avakian v. Citibank, N.A., 773 F.3d 647 (5th Cir. 2014) (violation of Mississippi’s two-signature requirement makes mortgage void even against signing spouse, but when spouses signed two identical deeds of trust within a day of each other, the two deeds were part of one transaction and mortgage was valid); Terminix Int’l, Inc. v. Rice, 904 So. 2d 1051 (Miss. 2004) (two-signature requirement did not apply to arbitration agreement in contract with exterminator, as contract did not affect wife’s ownership interest in home).

MISSOURI: Mo. Rev. Stat. §§ 474.150(2), 513.475. But cf. In re Clark, 384 B.R. 563 (Bankr. W.D. Mo. 2008) (when spouses were living apart, husband’s signature not required; he had no homestead rights in property he neither owned nor occupied).

NEVADA: Nev. Const. art. 4, § 30; Nev. Rev. Stat. § 115.040. See Besnilian v. Wilkinson, 25 P.3d 187 (Nev. 2001) (one spouse may not alienate homestead property without consent of the other).

NEW HAMPSHIRE: N.H. Rev. Stat. Ann. § 480:5-a. See Maroun v. DeutscheBank Nat’l Tr. Co., 109 A.3d 203 (N.H. 2014) (homestead protects non-titled spouse; both spouses must sign mortgage, but homestead right can be waived by an act that “evidences an unequivocal intention to do so”; waiver shown here). Cf. In re St. Onge, 317 B.R. 39 (Bankr. D.N.H. 2004) (second mortgage will encumber homestead if signed by both spouses with formalities required for conveyance of land). But cf. Walbridge v. Beaudoin, 48 A.3d 964 (N.H. 2012) (spousal signature not required for mortgage of property on which couple were building a house; statute applies only to homesteads, which require present physical occupancy).

NORTH DAKOTA: N.D. Cent. Code § 47-18-05. See In re Linne, 414 B.R. 536 (Bankr. D.N.D. 2008) (North Dakota strictly enforces requirement for notarized signatures of both spouses for sale or encumbrance of homestead; mortgage was unenforceable even though both spouses admitted genuineness of signatures). But cf. In re Hoggarth Bros., 2004 WL 903814 (D.N.D. Apr. 22, 2004) (farm couples resided on land owned by farm partnership; because non-partner wives owned no interest in land, mortgage signed only by partner-husbands was valid).

TENNESSEE: In re Estate of Fletcher, 538 S.W.3d 444, 448 (Tenn. 2017) (stating in dicta that, where real property is held as tenancy by entireties, both spouses must consent to any transfer).

TEXAS: Tex. Const. art. 16, § 50(a)(5)(A); Tex. Family Code § 5.001 (West); Tex. Prop. Code § 53.254(c) (West). See Denman v. Atlas Leasing, L.L.C., 285 S.W.3d 591 (Tex. App. 2009) (mechanic’s lien void for lack of husband’s signature; couple were living apart but still married when wife bought house and negotiated for work in her own name, but no evidence she deceived creditor); Cadle Co. v. Ortiz, 227 S.W.3d 831 (Tex. App. 2007) (mechanic’s lien on property titled in wife’s name alone invalid when husband did not sign; homestead exemption waived if married person deliberately misrepresents self as single, but burden of proof on creditor; not shown here). But cf. Skelton v. Wash. Mut. Bank, 61 S.W.3d 56 (Tex. App. 2001) (widow had no claims on homestead, and mortgage not invalidated by lack of her signature, when couple agreed husband alone should apply for mortgage because of wife’s bad credit record and husband falsely informed lender he was single).

VERMONT: Vt. Stat. Ann., tit. 27, § 141. See In re Jones, 534 B.R. 588 (Bankr. D. Vt. 2015) (mortgage not signed by non-titled wife was voidable, but granting equitable subrogation to lender for sums that benefitted wife by paying off prior mortgage, back taxes, and other debts secured by marital property); In re Jakab, 293 B.R. 621 (Bankr. D. Vt. 2003) (mortgage of homestead void for lack of wife’s signature). But see In re Muther, 479 B.R. 316 (Bankr. D. Vt. 2012) (rule applies only if non-signing spouse has homestead interest in property; here, non-signing wife had lost homestead as result of transfer between spouses). But cf. GMAC Mortg. Co. v. Orcutt, 506 B.R. 52 (D. Vt. 2014) (lack of signature by husband who was actually present at closing made mortgage voidable, not void; Erie-guessing that Vermont would allow equitable mortgage on these facts); Charter One Bank v. Estate of Spillane, 807 A.2d 452 (Vt. 2002) (lack of signature renders mortgage voidable, not void; when husband took out home equity line, then first wife died and husband and second wife divorced and remarried after date of last advances, wives’ rights were extinguished by death or divorce).

WISCONSIN: Wis. Stat. § 706.02. But cf. Jones v. Estate of Jones, 646 N.W.2d 280 (Wis. 2002) (broad language in premarital agreement allowing spouses to manage separate property waived homestead rights; when husband deeded house to wife and wife deeded it to another, second deed valid without husband’s signature).

134 See, e.g., In re Melber, 315 B.R. 181 (Bankr. D. Mass. 2004) (husband who owned homestead property conveyed it to himself and wife as tenants by entireties without reserving homestead and without wife’s signature; two wrongs made a right and exemption survived); In re Desroches, 314 B.R. 19 (Bankr. D. Mass. 2004) (homestead exemption subordinate to second mortgage signed by both spouses with words of grant and mortgage covenants, even though it did not explicitly release homestead).

135 ReadyCap Lending, L.L.C. v. Alexander, 2018 WL 503966 (Mass. Land Ct. Jan. 19, 2018) (Massachusetts revised homestead statute eliminates the signature requirement for non-titled spouse; applying statute to lien incurred before the statute’s effective date).

136 See In re Burks, 421 B.R. 762 (Bankr. N.D. Miss. 2009) (purchase money mortgage valid without wife’s signature, but subordinate deed of trust for loan to cure mortgage delinquency not purchase money, and invalid); Wells Fargo Home Mortg., Inc. v. Newton, 646 N.W.2d 888 (Minn. Ct. App. 2002) (when proceeds of refinancing used partly to pay off old mortgage and partly for other purposes, only the sum used to pay off mortgage will be treated as purchase money, excluded from homestead protection). See also Deutsche Bank Nat’l Tr. Co. v. Roberts, 233 P.3d 805 (Okla. Civ. App. 2010) (extending Oklahoma purchase money exception to refinancing that paid off purchase money loan; granting equitable lien to lender when refinance loan was void due to forgery of wife’s signature). But cf. In re Rhymes, 2008 WL 723975 (Bankr. S.D. Miss. Mar. 14, 2008) (deed of trust void for lack of wife’s signature, even though she conveyed her interest in land to husband before he signed; purchase money exception not applicable, when loan to purchase manufactured home was secured by underlying land, already owned and occupied by borrowers).

137 See, e.g., United States v. Neff, 2007 WL 776532 (D.N.D. Mar. 12, 2007) (homestead exemption may not be waived for chattel debt; creditor also failed to show waiver was knowing and voluntary). See generally § 13.3.9, supra (waiver of exemptions).

138 Tex. Const. art. 16, § 50(a).

139 See National Consumer Law Center, Consumer Credit Regulation Chs. 10, 11, Appxs. C, D, E (2d ed. 2015), updated at www.nclc.org/library.