Jurisdictions
Arizona, California, Idaho, Louisiana, Nevada, New Mexico, Texas, Washington and Wisconsin
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Intro
A community property state is one in which property obtained by either spouse during the marriage is treated as property equally owned by the marital unit—the “community”—regardless of which spouse “earned” that property. Other states may take an equitable view by taking into account each spouse’s contribution to property acquired during the marriage. This distinction has implications most commonly seen in divorce cases, where property is divided among the divorcing spouses. However, community property law can also seriously impact creditors if proper steps are not taken to obtain a proper …show more content…
If any married guarantor’s spouse does not sign the guaranty, it is important that the agreement also address the issue of whether the other guarantors will have recourse to the community property, entireties property or other form of marital property of that guarantor and his or her spouse or whether recourse will be limited to the guarantor spouse’s separate property. If the agreement provides for recourse to the marital property, it is advisable that the non-guarantor spouse also join in or consent to the contribution agreement to the extent required under applicable state law in order to give effect to these provisions.
Fannie Mae Guaranty
Guarantor’s obligations under this Guaranty constitute a present and unconditional guaranty of payment and not merely a guaranty of collection. If Guarantor (or any Guarantor, if more than one) is a married person, and the state of residence of Guarantor or Guarantor’s spouse is a community property jurisdiction, Guarantor (or each such married Guarantor, if more than one) agrees that Lender may satisfy Guarantor’s obligations under this Guaranty to the extent of all Guarantor’s separate property and Guarantor’s interest in any community property. …show more content…
Arizona law dictates that although either spouse may separately bind the community, the joinder of both spouses is required for “any transaction of guaranty, indemnity, or suretyship.” Although there is a slight potential in appropriate circumstances of an estoppel binding the community assets, a prudent lender will not need to rely on this argument. Failing to obtain both spousal signatures was even fatal where the guarantor was a general partnership that guaranteed a third party debt and the signing spouse was a general partner of the guarantor. However, a general partner who without spousal joinder signed a guaranty of the partnership's own debt was characterized not as a guarantor, but as a general partner, and the outcome was different. Here, the statutory joinder rule did not apply as the signature of the general partner of the partnership debtor was not in essence a