The other advice I have for unmarried couples buying a home is to seek attorney advice before signing a contract. It can put a sour note on a seemingly lifelong relationship but purchasing an investment is a partnership that needs to be clearly defined going in. I've seen this scenario before and it can be worse than a bitter divorce.
What an unfortunate situation. If whoever is responsible for paying the mortgage defaults (I'm assuming that is you right now) the occupant will be evicted upon foreclosure. The other legal title holder has the option to step in at anytime and make payments so I don't see how she could sue you in the event of a foreclosure. It would have devastating effects on your credit though so I'd definitely try a short sale or traditional sale. She may not sign a quit claim deed but she might take over payments if she knows you aren't going to make them anymore. It is always good to consult an attorney who specializes in real estate transactions in your state for definitive answers.
If the bank forecloses, whoever lives in the house may be evicted.
Seems like both sides should attempt to come to an agreement. If you engage an attorney, your attorney may be best equipped to explain to both sides what the consequences are. If no one comes to an agreement, both sides lose.
The bank will foreclose when the mortgage payments are missed, and the title to the house will now become a bank owned REO. Your credit will be messed up for years, and your wife will have no consequences. I would think $10,000 might be a good deal, and give here some money up front and monthly payments.
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If that is not the case, if there is no equity in the home and/or she did not pony up for the down payment when the two of you bought the house, and she is unwilling to be reasonable as you suggest, you may have to go to court in order to resolve the matter.
Allowing the property to go to foreclosure may cause additional problems outside of her suing you or it damaging your credit. Such a drastic solution should be avoided until you have all the facts from a qualified attorney who specializes in real estate law.
If you are on the mortgage and foreclose, only your credit gets ruined.
If your ex fiancÃ©e is not paying towards the house then she looses the home too.
It all comes down to what was the written agreement between you two.
Verbals are no good, if the written agreement was that she contributed towards the down and you would
Pay for the loan then, $10k is a good option.
Consult a lawyer.
P's. My wife is a real estate attorney, seek one in your city.
The answer is Yes, she could sue you, because anyone can sue anyone they like in this country.
Because of this, you should seek the assistance of an attorney.
If when you purchased the home, she contributed to the down payment and closing costs, then the right thing to do would be to buy her out with that amount. If she can substantiate that she has $10,000 invested in this property, then it would make sense that she get this back. The question she would have to ask is whether or not it's worth $10,000 to hire an attorney to chase $10,000.
I guess the real question is, what would she be suing you for?
Feel free to contact me for a referral. There are some unanswered questions to your situation that would be helpful in deciding what step to take next.
Carlos J. RamÃrez, PC, ABR, CNE
Associate Broker/Realtor, HomeSmart â€“
Certified Negotiation Expert (CNE)
Run don't walk to the best Real Estate attorney you can find. Can't imagine she would have leg to stand on since you'll be the only one hurt (credit wise) by the foreclosure. However because she is on the deed she does have legal claim to the property.
If you don't have any equity in the home, I'm not sure what the point would be. If you do have equity, being on title, she may be entitled to some of the equity.
Either way, if you are on the mortgage and don't make payments, you will be the one that the bank is coming after when they foreclose. Your credit will be impacted for delinquencies.
Best of luck!
Attorneys seem to be in the $150 to $250 for a consultation like this. It could be money well spent.
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