How can I get out of a joint loan with my brother?

Asked by Kelly Perkins, Denver, CO Sun Jan 18, 2009

I own a home with my brother. We want to go our own ways however I dont think i can refinance alone because we both just lost our jobs and are on unemployment. My girlfriend is able to move in (she has a job, but bad credit - a recent foreclosure) she wouldnt be able to get a mortgage. I do have funds to buy him out, however. What are our options? I mentioned a quit claim, but he wants off the loan if he is not living here due to financial responsiblity down the road if there would be a default ( just for his protection) The home probobly cant be sold due to market downturn, the home needs repairs and we would owe more than current value. HELP PLEASE!!! One of us needs to go!!

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Chuck Strau…, Agent, Denver, CO
Sun Jan 18, 2009
All good answers. I would suggest that you contact your lender, a real estate professional, mortgage professional and a real estate attorney to get the best possible advice.
Chuck Straus
Keller Williams DTC
0 votes
Joetta Fort, , Arvada, CO
Sun Jan 18, 2009
I've had family members live with me (parents, in my case) and I know how nightmarishly difficult it can be. However, is there any chance you could work things out well enough to put his moving out on hold? Things may turn around and give you more opportunities for a sale in the not-too-distant future. I know a year or two can seem like a long time, but if you can work it out it may benefit you both.

I think you absolutely should get a market analysis that not only shows what the house would probably sell for now, but what the trend is in your neighborhood as far as absorption rate, days on market, number of homes in foreclosure status, etc. If you see things trending in the right direction, maybe it will give you incentive to stick it out. Then, keep getting a new comprehensive market analysis every six months to keep an eye on the trend.

And do speak to a lender who's willing to keep on working with you even if you can't qualify right now. A good lender should be able to tell you when you probably could qualify, and what you'd have to do to make that happen. I know a lender like that.

I wish you all the best, let me know if I can help.
0 votes
Bill Eckler, Agent, Venice, FL
Sun Jan 18, 2009

Simply stated....the most reliable information will come from a real estate attorney.

Good luck
0 votes
Kurt Thomas, , 81501
Sun Jan 18, 2009
tough situation, I suggest speaking with the current lender about the situation and/or a lawyer. Perhaps the money you have to buy him out could be applied to a down on the refi?
The home does have value, and CAN be sold, probably under market value though based off of your comments. Contact a local Realtor that has worked your area and get a comparative market anlsys. John Keene below looks to be a Realtor in your area, I suggest taking him up on his offer.
0 votes
Brian Burke, Agent, Highlands Ranch, CO
Sun Jan 18, 2009
Hi Kelly, I believe that a person would have to re-fi in thier name to remove the brother. A quit claim would only take him off of title and not release him from the loan. This may be a question for a Real Estate Attorney.
I hope this helps and good luck to you.
0 votes
John Keene, Agent, Denver, CO
Sun Jan 18, 2009

Call my preferred lender, Mike Savel, over at Chase Bank. His number is 303-625-3123. Many people come to the belief that they can not qualify for a loan without ever talking to a qualified lender. Mike can run several scenarios for you (with of without your girlfriend, 40-year vs. 30-year mortgage, etc.) and he will do his best to find something that works for you.

If you would like a professional opinion about the value of your home in this market, I'd welcome the opportunity to meet with you and discuss those options.

Best of luck,

John Keene
Keller Williams
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