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Writer's pictureLUNDELL LAW

FREE TRADER AGREEMENTS & MARRIAGE

Updated: Apr 5, 2021



As a divorce lawyer practicing in Union County, clients often ask me about “Free Trader Agreements” or provisions. What are they? Do I need one in my separation and divorce? Divorce lawyers often include such provisions in Separation Agreements. Let’s review what free trader agreements are, and whether you need one in your divorce or separation.

What is a Free Trader Agreement? Free Trader Agreements allow a husband or wife to purchase property after the date of separation but before an absolute divorce without the necessity of having the other spouse being placed on the deed. The most common scenario—husband and wife separate. One spouse stays in the former marital home. The other spouse moves out and intends on buying a new place. However, the paperwork gets caught up because the spouses refuse to both sign and be on a deed for new property together. Obviously, the parties do not want this. What to do? This is the basic premise behind a Free Trader Agreement.

With a Free Trader Agreement, the spouses can freely purchase real property without placing the other spouse on the deed. This, by no means, will allow one spouse to sell the former marital home without the consent of the other—that is not what this is for. Instead, this allows the “purchasing” spouse to keep that real property as a separate asset and a separate obligation (ie—the mortgage). This can have huge value for both parties. This document can also address the obligation that each party has to the other to refrain from attempting to get credit in the others’ name, as well as to promptly pay all debts and financial obligations incurred from the date of separation on.

Free Trader Agreements should be drafted in accordance with N.C.G.S. 52-10 and 39-13.4, they must be signed by both parties and notarized, and are filed with the Register of Deeds.

I Already have a Separation Agreement…Do I need a Free Trader Agreement? If you do not have a recorded Free Trader Agreement, this can be very problematic as North Carolina requires parties to live separate and apart for at least one year before a party may file for divorce. Any plans to purchase, sell or refinance real estate may be put on on hold until the 12-month waiting period is over. Even after parties that have legally separated and remain separated for 12 months, it can take an additional two or three months to obtain the actual divorce judgment. Often during this process, my clients will need to either acquire or transfer real estate after their separation and prior to entry of a divorce judgment.

Most North Carolina divorce law firms include some standard “free trader” provisions in their Separation Agreement and Property Settlement Agreements. If drafted correctly and properly executed, these provisions may be completely enforceable, however without a separate record-able document containing a Free Trader Agreement you will be forced to record your entire separation and agreement and property settlement with the local register of deeds.


This may not seem like a big deal, however recording costs can be rather high for a long documents, and more importantly you may not wish to have your personal life exposed like that for all the world to see into posterity. Anyone and everyone could access your entire separation agreement if the whole document is recorded.

Speak to a Monroe/Union County Family Law Attorney If you are unsure whether or not you will be purchasing property after your separation and prior to your divorce, please make make sure you talk with a local divorce lawyer to discuss the matter prior to entering into any divorce settlement or Separation Agreement and Property Settlement. Call Lundell Law Firm at 704-288-4096 to discuss all of the issues surrounding your separation.

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