FHA: Take her off title. Wait one year. Refinance after one year in your name only stating to the lender that you are better off without a co-borrower on the loan (FHA loves this as it shows independence). In the meantime, the ex can obtain 12 months cancelled checks from you showing that you are making the payments and it won't count against her income for qualifying purposes.

Conventional: Take her off title (this takes her right's away from the property eh?) and refinance when the value goes back up to refinance. To protect yourself, have an attorney write up anything to do with the equity. Don't play the he said she said with women when it comes to divorce. Hell hath no fury like a woman scorned.

You must refinance (or sell) in order to get your soon-to-be ex-wife's name off the mortgage. Lenders won't just remove a name from the mortgage. Won't happen.

The problem is that your home's price is lower than what you paid, and presumably lower than what you owe on it. If, for example, you owe $300,000 but you'd only net $270,000 after the sale, then you'd have to come to closing with $30,000.

You can continue paying the mortgage yourself. However, that won't get your wife's name off the mortgage. And she'd still be liable if you fell behind or failed to make your mortgage payments--which I'd guess is why she wants off the mortgage.

One other point: Don't confuse ownership with the mortgage. I'm not a lawyer or an accountant. But at this point you don't want to mess around with quit claiming shares of the home to each other.

Your lender will most likely require you to refinance with a new loan just in your name. You should ask your lender.