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How to agree on the ownership of the house in Ningbo marital property agreement.

Ningbo Author：LuXu WANG

After getting married, Mr. Wang and his wife jointly purchased a property, and they wish to enter into a marital property agreement stipulating that the house shall be owned by one of them. How to write a marital property agreement to be effective? Does the house automatically return to one side after signing? The conclusion first says: the marital property agreement stipulates the ownership of the house, which should be in written form, writing out the house information, property ownership, loan commitment, compensation method and transfer arrangement; The agreement is legally binding between husband and wife from the time it is signed by both parties, but in order to obtain the effect against the bona fide third party and realize the real change of property rights, it is also necessary to register the change of property rights. If the house still has a mortgage, the change registration must be approved by the mortgagee (bank). No matter how clearly the agreement is drafted, if the necessary formalities are not properly completed, it will still leave hidden risks.

1. Legal Basis: The Scope of Effectiveness of the Agreed Property System

Article 1065 of the Civil Code of the People's Republic of China stipulates: "The spouses may agree that the property acquired during the marriage relationship, as well as the premarital property, shall be owned by each spouse individually, jointly, or partly by each and partly jointly." The agreement shall be in writing. In the absence of an agreement, or where the agreement is unclear, the provisions of Articles 1062 and 1063 of this Law shall apply. Any agreement between spouses regarding property acquired during the marriage as well as premarital property shall be legally binding on both parties. The husband and wife agree that the property acquired during the marriage shall be owned by each other, and the debts incurred by the husband or wife to the outside world shall be paid off with the personal property of the husband or wife if the relative knows the agreement." The

requirements are disassembled as follows:

  1. Subject: It must reflect the genuine intentions of both spouses and cannot be decided unilaterally by one party; signatures may not be obtained through fraud or coercion.
  2. Form: Must be in writing. Verbal agreements, in principle, have no legal effect.
  3. object: it can be agreed that the whole or partial ownership of the premarital property and the marital property, including the common property owned by one party, shared by shares or still shared by each other.
  4. internal effect: the agreement is legally binding on both parties since it is signed by both parties (or the agreed effective conditions are fulfilled), and both parties should abide by it.
  5. External effectiveness: when the third party (the creditor, the buyer, the mortgagee) is involved, the agreement can not naturally oppose the bona fide third party; the party who agrees that the property belongs to each other must "know the agreement" before the creditor can pay off the debt with the personal property of the borrower.

Contents of 2. Agreement: The property ownership clause should include all six elements

A feasible property ownership agreement should at least clearly specify the following six items:

  1. the basic information of the house: the location and address of the house, the real estate certificate number, the construction area, the purchase price, the registered right holder, etc., to ensure that the orientation is unique and there is no ambiguity.
  2. Ownership of property right: it is clearly agreed that the house shall be owned by one party personally, or shared by shares (indicating the proportion of shares), or still shared by common. The expression must be definite and avoid vague terms such as "in principle" and "as far as possible.
  3. Loan Assumption: If the property is still under mortgage, specify who will continue to repay the remaining principal and interest, and who will bear the liability for any defaults. This point isEasiest to be ignored, and it is also a frequent source of future disputes.
  4. compensation arrangement: if the house is originally a common property and it is agreed to be owned by one party, the other party should usually get corresponding compensation; state the amount of compensation, the time of payment and the liability for overdue breach of contract.
  5. Transfer Arrangements: Specify the timing for completing the property ownership transfer registration, which party is responsible for cooperation, and the liability for breach of contract in case of non-cooperation; where a bank mortgage is involved, outline the procedures for releasing the mortgage or obtaining the bank’s consent.
  6. Expenses and taxes: Make clear who will bear the taxes (deed tax, registration fee, etc.) involved in the transfer. According to the current policy, there is a clear scope for the exemption of deed tax from the change of house ownership during the marriage relationship between husband and wife, which is subject to the caliber of the tax authorities.

Take the common situation in Ningbo as an example: after the couple jointly funded the purchase of the house after marriage and registered in the names of both parties, if they want to be owned by one party through the marital agreement, besides the written agreement, they also need to deal with the repayment subject of the remaining mortgage and the property right change registration simultaneously; if the house still has a bank mortgage, the change registration needs to obtain the consent of the mortgagee (bank), these two steps are indispensable in the practice of Ningbo real estate registration.

Supplementary reminder of the details of the signing form of the agreement: the agreement should indicate that "this agreement is signed voluntarily by both parties, the content is true, and there is no fraud or coercion", and the signing date should be signed by both parties; the page-by-page signature with a large number of pages prevents page change; if it involves major property, it is recommended to save the audio and video recording of the signing process at the same time or be witnessed by two uninterested witnesses. The amount, proportion and time in the agreement must be confirmed in capital or Arabic numerals and words to avoid alteration of disputes. If one party is illiterate or has difficulty writing, they shall affix their fingerprint and make a corresponding notation, or have their expression of intent formally documented through a notarization procedure.

3. registration and publicity: the difference between internal effectiveness and confrontation with the third party

Many parties think that "the house will automatically belong to me after signing the agreement", which is a misunderstanding of the rules of property rights change:

  1. The entry into force of the agreement and the change of real right are two different things.: A marital property agreement becomes binding between the spouses upon signature (having the effect of a debt), but, as real property, the change in ownership of a house is subject to registration (Article 209 of the Civil Code: The establishment, modification, transfer, and termination of real property rights shall take effect upon lawful registration; without registration, such effects shall not arise).
  2. consequence of no transfer of ownership: before the registration is changed, the agreement is valid for both parties, but it may not be able to resist the bona fide third party-for example, the registered obligee sells the house to the bona fide buyer and handles the transfer of ownership without authorization, and the other party can only claim breach of contract or compensation from the other party if it is difficult to recover the house according to the internal agreement.
  3. The effectiveness of the transfer: after the registration of property rights change, the ownership of the house belongs to the agreed party at the registration level, the effectiveness of publicity is complete, and the problem of confronting the third party is basically eliminated.
  4. Special rules suggest that there are two differences in judicial practice between treating according to marital property agreement and treating according to gift for the clause that one party agrees to belong to the other party before marriage; if it is treated according to gift, the donor may claim to revoke it arbitrarily before the transfer. A prudent approach is to promptly complete the transfer registration upon signing the agreement and, if necessary, have the agreement notarized to formalize the expression of intent.

4. Boundary conditions and common risk scenarios

  1. the interests of creditors shall not be harmed: if the husband and wife transfer property and evade debts in the form of agreement, the creditor may request to cancel according to Article 538 of the Civil Code. When an agreement stipulates that a house is to be owned by one party, the other party may be suspected of attempting to evade debt if they have outstanding substantial debts.
  2. If a property is mortgaged, the transfer of ownership requires the consent of the mortgagee.: The registration of ownership transfer of a mortgaged house during the duration of the mortgage is generally subject to the consent of the bank (change the subject of the loan or early settlement), otherwise the registration agency will not handle it.
  3. Handling Conflicts Between Agreements and Registration Status: When the terms of an agreement differ from those recorded in the registry, internally the agreement shall prevail, while externally the registration shall prevail; to minimize such conflicts, the agreement should serve as the basis for transfer, and registration should be processed promptly.
  4. "conditional agreement" conditional on divorce": If the agreement stipulates that "the house belongs to a certain party in case of divorce", which is a conditional clause and the validity determination is complicated, the court may judge whether it belongs to the nature of the divorce agreement in combination with the whole agreement, and suggest to clearly state the effective time point (it takes effect from the date of signing the agreement, rather than taking divorce as the condition).

The invalidity and revocability of the agreement should also be understood: if the agreement transfers the property to evade the debt and damages the interests of the creditor, the creditor can request the revocation according to Article 538 of the Civil Code; the content of the agreement restricting the personal rights (such as the agreement that one party shall not remarry or have children, or the agreement to give up the right of custody of children) is invalid because of violating the mandatory provisions of law and public order and good customs; if one party, by fraud, coercion or by taking advantage of others, causes the other party to sign a contract against its true will, the aggrieved party may request revocation. It is also necessary to distinguish between "marital property agreement" and "divorce agreement": the former is signed during the marriage, agrees on the ownership of property and the assumption of debts, takes effect from the signature, and is not conditional on divorce. Confusing the two can lead to errors in determining the agreement’s validity—marital agreements that state “the house shall belong to X upon divorce” are more akin to divorce agreements, and the wording of their effective‑date clauses should be handled with particular care.

5. operational steps and material list

  1. Determine the present value of the house and their respective shares: Determine the value of the house through evaluation or negotiation between the two parties, and define the compensation base.
  2. Drafting the written agreement: Write the whole agreement according to the above six elements. It is recommended to use clear clause numbers to avoid handwriting alteration.
  3. Both parties sign and press their fingerprints: indicate the date of signing; in order to enhance the proof force, it can be recorded synchronously or witnessed by witnesses, and notarized if necessary.
  4. handle the registration of property right change: bring the agreement, identity card, marriage certificate, immovable property right certificate and other materials to apply to the real estate registration agency where the house is located; if there is a mortgage, communicate with the bank to change the borrowing subject or settle the loan in advance.
  5. deal with tax matters: declare relevant taxes and fees according to the requirements of the tax authorities. if the husband and wife can enjoy preferential treatment within the scope of the property analysis policy, they should apply with marriage certificate, agreement and other materials.
  6. RETAIN THE ORIGINAL AGREEMENT AND CERTIFICATE OF TITCHARGE: safekeeping as core evidence in the event of a subsequent dispute.

Common 6. Mistakes

Misunderstanding 1: After signing the agreement, the house will automatically return to one side. Positive solution: The agreement is valid between husband and wife, but the real estate is subject to registration. If the property right change registration is not handled, the agreement cannot completely oppose the bona fide third party, and the risk of the registered right holder disposing of the house without authorization is still there.

Misconception 2: Verbal agreements regarding property ownership are valid. Correct Solution: Article 1065 of the Civil Code explicitly requires written form. In principle, oral agreement has no legal effect, and the proof can hardly be completed.

Misunderstanding 3: The agreement can be reversed or revoked at any time. Correct solution: the legally established agreement on the property of husband and wife is legally binding to both parties, and there is no "repentance at any time"; if it only involves the terms of the nature of personal property donation before marriage, there is a dispute of cancellation before the transfer of ownership, which can be eliminated by handling the transfer or notarization.

Misunderstanding 4: Only write who owns the house, not the loan and compensation. Positive solution: only agree on attribution, do not write the loan commitment and repayment compensation, divorce may still have a dispute on compensation, but also may affect the credit of both parties due to overdue loans; loan commitment and transfer arrangements must be written out simultaneously.

7. Frequently Asked Questions

If a marital property agreement stipulates that a house belongs to one spouse, is notarization required?

Notarization is not required by law, and the agreement takes effect when signed by both parties. However, notarization can enhance the power of proof, fix the true meaning at the time of signing, reduce the defense space such as "coerced", "illiterate" and "content tampered with" in the future. Ningbo notary institutions can handle the notarization of marital property agreement.

The house still has a mortgage loan, can it be directly transferred to the name of the agreed party?

The mortgaged house is in the state of mortgage, and the registration of property right transfer generally needs to obtain the consent of the mortgagee (bank) first. The usual path is: change the borrower (the bank re-examines the qualification of the new borrower) or settle the loan in advance and cancel the mortgage before transferring. It is suggested to confirm the feasibility with the loan bank first, and then sign the agreement to agree on the transfer time limit, so as to avoid the agreement signed but can not pass the account.

The agreement stipulates the ownership of the house, but there is no transfer of ownership. What if the other party sells the house?

If the purchaser acted in good faith and has already completed the transfer registration, it will be difficult to reclaim the property; you can only seek breach-of-contract damages from the party who improperly disposed of it or claim a smaller share of the marital assets upon divorce. If the buyer knows or should know that the house has an internal agreement between the husband and wife and fails to pay a reasonable consideration, he may claim that the contract of sale is invalid or revoked. The fundamental way to prevent such risks is to transfer ownership as soon as possible after signing a contract.

If one party owes a lot of debt and signs an agreement transferring the property to the other party, can this be used to avoid the debt?

No. If the transfer of property by agreement evades the debt, the creditor may request the court to revoke the agreement, and even if the house has been transferred, it may still be revoked or enforced if it is found to have evaded the debt in bad faith. The party whose property is agreed to be owned by each party to borrow money externally, and only if the creditor knows of the agreement, the debtor's personal property will be paid off, and the "know" must be proved by the claimant.

Practical experience of 8. lawyers

The most common misunderstanding of marital property agreement is that the house will automatically return to the same party after both parties sign the agreement. In fact, the agreement is binding between the two of you from the time it is signed, but in order for the property rights to really change and be able to resist unwitting third parties, you have to go to the transfer registration. A mortgaged property also involves the bank; any change of registration typically requires the consent of the mortgagee, and this step is unavoidable. Therefore, the pragmatic mentality is: both the agreement and the registration should be grasped. after the agreement is written, the transfer of ownership should be arranged as soon as possible. don't put it on the shelf after signing. only when the divorce occurs can you find that the procedures have not been followed and the house is still under the names of the two people.

Don't try to save trouble when writing the terms. The housing ownership terms should include several elements: the location and ownership certificate number of the house, who owns it, who will bear the remaining loan, whether to compensate the other party, the amount and method of compensation, the time and tax of transfer, and the liability for breach of contract when one party does not match. The more specific you write, the less likely it will be to wrangle in the future. In particular, it is necessary to avoid writing only one sentence that the house belongs to so-and-so without mentioning the loan and compensation. As a result, one party often takes the house while the other party continues to carry the loan or cannot get the money, which is tantamount to delaying the contradiction.

There are several other risk points worth thinking about first.The agreement should be based on the true and voluntary nature of both parties, and the signatures exchanged by concealment and coercion will easily be overturned in the future. The content cannot violate the law or violate public order and good customs, and the punishment clauses such as cheating and leaving the house may be mixed in, which may affect the stability of the whole agreement. If one party has a debt outside, the agreed property may not be valid for a third party, the other party may still come to the door without knowing it, such a situation should be assessed in advance. Before you start work, you should distinguish whether you want to change the property right or clarify the compensation obligation. The writing method and follow-up procedures are different for different goals.

The marital property agreement stipulates the ownership of the house, and the key is "write all, sign and transfer": write all six elements (information, ownership, loan, compensation, transfer and expenses) in writing, sign voluntarily by both parties, and then handle the registration of property change as soon as possible. The agreement solves the ownership and compensation within the husband and wife, while the registration solves the external publicity and confrontation, both of which are indispensable. If the house has a mortgage, first pass the bank and then set the time limit for transfer. Involving premarital personal real estate, through notarization and timely transfer to eliminate the cancellation dispute. After the signing of the agreement, be sure to keep the original, title certificate and payment certificate, as a basis for future claims of rights.