Free Trader Agreements are agreements that allow a spouse to buy or sell real estate in North Carolina without the joinder involvement of their other spouse. Free Trader Agreements can happen for a bunch of different reasons. For example, if one spouse is a real estate developer and buys and sells properties all the time, and the other spouse is busy doing something else, they may want to have the non-involved spouse sign a Free Trader Agreement, relinquishing any ownership from the properties bought and sold. Free Trader Agreements can be specific or limited for let’s say one property only, or Free Trader Agreements can be general, such as for every property moving forward from this date, or all property bought in this state, etc.
Free Trader Agreements can also be used if people are divorcing. Let’s say a couple has split and they are now separated in North Carolina. One spouse wants to go buy a house a month after they separate, but North Carolina laws say you must be separated for 1 year and a day before the divorce is final. The law treats you as either divorced or not divorced. So technically when a couple has separated, if one spouse wants to buy a home, the other spouse gets an interest in that home, unless you do a Free Trader Agreement. Now, the spouse that is wanting to buy a home can do a Free Trader Agreement and become a Free Trader, which relinquishes the other separated spouse from any ownership in the property being bought.
The main reasons you need to do a Free Trader Agreement between spouses (or separated spouses) is because there are three different interests a spouse can have in property. A spouse has a real property ownership interest, marital interest, and marital property interest. Therefore, a Free Trader Agreement is way to get around all three of these interests. If you are ever in need of a Free Trader Agreement, please reach out to our firm and we can help facilitate that for you.
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