The challenging part about your situation is that we are in a community property state and FHA and VA underwriting requires the inclusion of a spouse's debt in your debt to income calculations. However, that is not the case on a conventional loan. If your credit is good, you may qualify for as little as 3% down on a conventional loan where he debts are not included in your debt ratios. If she is not attempting to short sell the property, you may want to consider doing a deed in lieu of foreclosure. You should consult a real estate attorney when considering any options for disposing of the property. If you go the route of a deed in lieu of foreclosure you'll want to make sure to have in your documentation from the mortgage company that in return for her executing the deed that they are accepting the home as full satisfaction of the mortgage debt and that she does NOT owe any deficiency balance. That is an important point for your attorney to negotiate as it will establish that she does not have any debts going forward from the mortgage that must be considered in qualifying for FHA or VA financing for you in a community property state. Going the route of the Deed in Lieu will also likely put a quicker resolution to the situation that waiting out a foreclosure sale. Again, you should consult a real estate attorney for answers to your specific situation and none of this should be construed as legal advice. I am simply advising you on what an underwriter will consider for a loan qualification.
Brian Cardenas, Sr. Loan Officer
AmeriFirst Financial, Inc.