Can I refinance a house with my current husband that I own with my ex-husband to get my ex off the loan & Title? My ex lives in the house

Asked by Casey Larsen, Highland, NY Fri Dec 17, 2010

currently. We have tried to sell this house for over two years and even though we have followed the advice of our Realtor, we have not been successful in selling it due to this market. According to our Divorce Decree, I am responsible for paying half of the household expenses until the house sells or can be refinanced by either of us. Neither my ex or i can refinance ir on our own without another income. Now, since we cannot sell it without taking a huge loss, my new husband and I are thinking about "buying" it, but do not know the route we need to take. Can we just re-finance it, since I own and continue to pay half of the household expenses, as long as my ex agrees? Or, do my new husband and I "buy" it from myself and my ex? Ugh...so confusing! Please advice what can be done. My ex is willing to "walk" away as long as his name is taken off the mortgage and the Title of the house.

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Alex Gonta, , Bayonne, NJ
Thu Jan 27, 2011
this is really two questions in one: first, who is on the deed? Second, who is on the mortgage? So the answer depends on which scenario you have. First scenario: you and the ex are on the deed, but NOT on the mortgage together. Solution: your ex simply fills out a quick claim deed and deeds the property over to you. Second scenario, you are both on the deed AND on the mortgage. Simple: you put the existing deed into an a trust, making you the beneficiary. The trustee holds title for the benefit of the grantor (in this case, the grantor is also the "beneficiary"). If you place title to your property into a land trust, you have not violated the due-on-sale (so long as there is no change in occupancy) Then, you mortgage assign the trust. In other words, one party act as the seller, and the other the "buyer", but the deed is transferred into a trust first, and it's the trust that changes hands, and then the underlying financing has not had the dreaded "due on sale" clause invoked.

Here's a link explaining it for investors, but it applies to you, for different reason, the due on sale clause
http://reiclub.com/articles/no-due-on-sale-jail and also http://noteinvestor.com/tag/avoid-due-on-sale-clause/
Essentially, you need the mortgage obligation transferred above and beyond the deed obligation.

You can call your lender and ask them if there is a quick claim deed in place, and a divorce, will they release the other party from the mortgage obligation.
0 votes
Voices Member, , New Paltz, Ny 12561
Sat Dec 18, 2010
Ask your attorney about mortgage assignment, not assumable mortgage; if you want to find a different home for you and your new husband. Perhaps that might be the route to take.A short sale would be the very last resort followed by foreclosure.You need to consider that It will dampen your credit and you will not be able to purchase and perhaps even rent for at least two years with a short sale and even longer with foreclosure. Deed in lieu of foreclosure AKA Keys for Cash is another alternative but has a similar effect on credit. You may be able to negotiate a more favorable report, no deficiency judgement and move out date but non the less it is still reported to the credit bureau.- Legal proceeding and best handled by an attorney with such expertise.

If you'd like to keep the home that you are living in consider speaking with a loan officer to see if you and your new husband would qualify for a loan equal to the existing mortgage. If you are qualified than you can have your ex sign a quick claim deed. There are many possibilities which you should discuss with an attorney, as this is really a legal matter.

Lastly you must be extremely overpriced in order not to have sold your home within a two year span. The Highland market is moving and homes priced at market value are being sold.Have your real estate representative do another market valuation and take her advice according to what you see in black and white that have seen sold within a six month period. You might also want to get a certified appraisal which will let you know exactly what amount a bank would issue a mortgage for a new buyer. From that figure you can determine what the best recourse would be.

Best Wishes
0 votes
Annette Levi…, , New York, NY
Fri Dec 17, 2010
Do you have to pay off your ex? If so then it is a hybrid purchase. Either way the best way to do it would be a FHA mortgage if it will be owner occupied.
You will need to have a real estate lawyer (not your divorce lawyer) to draw up all needed paperwork (including new deed). You will also need a mortgage lender who is experienced in this type of transaction.
0 votes
jo, , Hollywood Hills, Los Angeles, CA
Fri Dec 17, 2010
Your best bet here is to contact a title company or a real estate attorney to see what your options are...
0 votes
Anna M Brocco, Agent, Williston Park, NY
Fri Dec 17, 2010
Consider consulting with your attorney and or tax professional to see what options are best for you--you can refinance if you qualify, and you could consider buying your ex out if needed, if your finances allow --rather than walking away, is a short sale an option for you--if so, protect yourself and any other assets you may have by consulting with an attorney who specializes in real estate beforehand.
0 votes
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