A free trader agreement is a document allowing spouses to buy a property after separation.
A free trader allows each spouse to buy property without putting the other spouse on the deed.
A free trader agreement gets used after legal separation, but before the divorce is final.
A free trader agreement allows a spouse to buy or sell a property without the other spouse signing papers.
A free trader agreement also allows a spouse to buy property without it becoming marital property.
This keeps the property only in the spouse’s name who is buying it.
Without a free trader agreement, the new house becomes marital property.
And you’ll be forced to split the new house in the divorce process.
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You need a free trader agreement to get a loan from the bank.
Most banks will not lend money to a separated spouse without either a:
These agreements ensure that the bank’s lien has priority over any marital interests.
In states like North Carolina, you have to be separated for a year before a divorce is granted.
There’s no way to buy property during separation without a free trader agreement.
Unless you want it to be marital property that gets divided.
Let’s talk about an example of a free trader agreement.
Normally when filing for divorce, one spouse remains in the marital home.
And the other spouse moves out and buys their own place.
This happens during the period of separation BEFORE the divorce is final.
Since the spouse bought a new house during separation, it’s still marital property.
That’s because the divorce has not been finalized yet.
A free trader agreement resolves this issue.
It allows the spouse to buy the house and it NOT be marital property.
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Let’s talk about a free trader agreement vs a quit claim deed.
A quitclaim deed “quits” a person’s claim to a property.
With a quitclaim deed, you are relinquishing your claim to that property.
A free trader agreement tells 3rd parties you can buy or sell property without your spouse’s consent.