Untangling Dower and Homestead

Many people confuse a dower right with a homestead right. More to the point, they struggle in understanding who must sign particular documents when BOTH dower and homestead are present.

I would like to take a shot at untangling dower and homestead. I hope to give the reader and practitioner a functional approach when dealing with either or both of these issues.

Dower is set forth in 558.1 (MCL), which reads in part: "The widow of every deceased person, shall be entitled to dower, or the use during her natural life, of 1/3 part of *all the lands whereof her husband was seized of an estate of inheritance*, at any time during the marriage, unless she is lawfully barred thereof."

Dower attaches to all lands of which the husband is "seized of an estate." What does "seized of an estate" mean? It means that the husband must own a property interest in fee simple. If the husband is a lessee or a land contract purchaser, dower will not apply. Additionally, dower does not attach to property in which the husband owns in joint tenancy with another. Importantly, dower does not attach to property held in tenancy by the entirety.

Example #1, State of Title: Bill Smith and Mary Smith, husband and wife. Here, Mary has no dower interest, rather she has a fee simple interest along with Bill.

Example #2, State of Title: Bill Smith, a married man. Here, Mary has no fee simple interest, rather she has an inchoate dower interest.

So, using our examples, what does all this mean? Well, the spouse of the man would be entitled to dower in "all" the lands owned by the husband. Some people believe that dower does not attach to land that is not the "primary residence" of the husband. The "primary residence" application is irrelevant. Whether property is the primary residence or not, dower attaches to all lands owned by the husband. This is by statute: no exceptions. Now, if the man holds title with his wife, as example #1 shows, she would have no dower, as she would hold in fee simple with the husband. Where you have a tenancy by the entirety you have no dower, and where you have dower you have no tenancy by the entirety.

Now to homestead. Homestead requires that a nontitled spouse join in the execution of a mortgage of property considered to be the "primary residence"of the couple. Homestead applies to both the man and the wife. The good news is that homestead only applies to finance transactions, it does not apply to conveyances.

Homestead is easy to represent with this example: Bob Jones is the owner of blackacre. He is married, but his wife is not on title. When Bob attempts to refinance, the wife will have to join in the execution of the mortgage for the purpose of acknowledging her "homestead" rights. Without her signature, the mortgage would be held invalid.

Interestingly, Bob's wife would also have to sign to bar her dower right in the subject property. The mortgage may read: "and Susan Jones, who joins in the execution of this mortgage for the dual purpose of acknowledging her homestead right and barring her dower right." This may seem long winded, but it is necessary.

Checklist for Sale Transaction:

1) Look at how title is held.

2) If the wife is not on title, she must sign the deed to bar her dower right.

3) If the wife is on title with the husband, she will be signing as a co-owner; no dower applies.

Checklist for Refinance Transaction:

1) Look at how title is held.

2) If the wife is not on title, she will have to sign to acknowledge homestead and bar dower.

3) If the *husband* is not on title, he will have to sign to acknowledge homestead rights.

4) If the wife and husband are both on title, both must sign the mortgage as co-owners; no dower applies.

Dower may be lawfully barred. The wife can voluntarily terminate her dower right in lands owned by her husband. She often does this via a deed to the husband with a clear recital that it is her intention to bar both present and future dower rights in the subject property.

Finally, if a man does not claim property as a "primary residence," it is not necessary for him to sign the mortgage. Instead, he would execute a non-homestead affidavit that would be placed with the closing package. And remember, he would only sign such affidavit if he is not on title. Similarly, if the wife does not claim property as a "primary residence," she will still be required to sign the non-homestead affidavit that would be placed with the closing package. But beware, if a wife does not claim property as a "primary residence," she still must sign to bar dower.

Sneaky but true. There is no easy way around this stuff, but keep in mind that dower is a legislative command. The participants in a transaction are not free to choose when it does and does not apply. It is most likely that the people are not trying to circumvent the law, but are simply confusing and co-mingling dower and homestead.

If you practice at keeping the two separate, it really isn't that hard to apply.

Hope this has been of some help,

Dave Phillips -- also known as "Elton" Phillips (check my glasses)