Bulletin: MO2007001

Dear Associates:

In Missouri, if title is vested in a man and woman who are husband and wife, the presumption is that they own the property as Tenants by the Entirety.  Each owns the whole, and both are considered as one person; neither one can convey or mortgage without the other.  When title is vested in husband and wife, the conveyance or mortgage instrument must specify both as Grantor/Borrower/Mortgagor. In Ethridge v. Tierone Bank , 226 S.W. 3d 127 (Mo., 2007), the Missouri Supreme Court found a Deed of Trust void, even though signed by both spouses, because only one spouse was named as Borrower.  The instrument stated that “Borrower irrevocably grants, bargains, sells, conveys and confirms…the property…” to the Lender.

Husband and Wife refinanced their home loan. The lender prepared the loan documents.  The Deed of Trust defined the term "Borrower" as the male spouse, "a married man, as his sole and separate property," even though title was vested in tenants by the entirety.  Both spouses attended the closing and both signed the deed of trust below the line for “borrower”.  Both signed a settlement statement.  Both initialed each page of the document. After Husband’s death, Wife filed an action to cancel the deed of trust.  The Missouri Supreme Court held that the deed of trust was void because there was no conveyance and grant of the wife’s interest.

Company Policy:  If you are insuring a deed of trust and title is vested in a man and woman who are husband and wife, both spouses must be the named Grantors/Borrowers/or Mortgagors so that both convey to the Lender and both must execute the instrument.

Thank you for your prompt and continuing attention to the matters addressed in this bulletin.