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  1. #1
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    Default Spinoff: Ex awarded house, my name is still on mortgage?

    Hi everyone, the recent thread about living together in a joint house after an ended relationship made me think (yet again) about my own situation and what my options are.

    Divorced for several months now and the court awarded the house to my ex, who said he would refinance and take my name off the mortgage. I've signed mortgage assumption papers for the bank, called the bank, nothing. He blames me for "taking so long" because I wanted to make sure I was getting a fair shake. He wanted me to sign a quit claim deed initially but I refused after I realized it would screw me over completely.

    He has good credit, but his dad is also co-signing the mortgage with him.

    As of our last conversation, and he only contacts me if he has something for me to sign and avoids all other contact, he said the paperwork expires today and after this he's not going to take any action to refinance the house. Should I be worried about this?

    Honestly, his credit score is better than mine and if he defaults, he's going to be in just as much hot water as I am. As an added benefit, his parents have always helped him out of whatever situation he's put himself in in the past, so I'm inclined to think they'll do so for him in the future as well. The fact that his dad is co-signing also seems to confirm this.

    Advice? Thoughts? Commiseration?
    “Thoroughbreds are the best. They’re lighter, quicker, and more intelligent.” -George Morris



  2. #2
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    Default

    What does your divorce agreement state? Is it expressed that he would be responsible for refinancing to remove your name from the debt obligation? If it is clearly spelled out, I would think he would be in contempt; that could be a "bargaining chip" with both the ex and his parents.



  3. #3
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    Hmm, well not sure it's specific enough to spell out r-e-f-i-n-a-n-c-e, but it says "the husband shall pay the following community or sepearate liabilities: mortgage on home located at XYZ."
    “Thoroughbreds are the best. They’re lighter, quicker, and more intelligent.” -George Morris



  4. #4
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    You want to get off that mortgage as quickly as possible, since you no longer have a claim to the underlying asset. In other words, if your ex bails on the mortgage, or sells it for way less than is owed, the bank will come after YOU to make them whole.

    A quit claim deed is the normal mechanism used to handle this situation but ONLY after the property is refinanced. Under no circumstances do you want to execute that document until you have removed yourself from any financial responsibility for the property.

    Hopefully your settlement agreement outlines your ex's responsibility to re-fi the property to remove you from the mortgage obligation - that is what is typically done when property is awarded to one person in this type of situation. If your settlement agreement does not spell that out very specifically, then I hate to say it but I would be consulting an attorney - a different attorney - about how to move forward. This is not something you want to ignore, unless you can tolerate the prospect of potentially being responsible for paying the mortgage on a property you no longer own, and having that obligation show up on your credit report until the mortgage is satisfied anytime YOU want a loan in the future for a house, car etc.
    **********
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    -PaulaEdwina


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  5. #5
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    You definitely need a lawyer and a copy of the mortgage agreement. Don't waddle, RUN!
    Thus do we growl that our big toes have,
    at this moment, been thrown up from below!


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  6. #6
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    Quote Originally Posted by Lucassb View Post
    You want to get off that mortgage as quickly as possible, since you no longer have a claim to the underlying asset. In other words, if your ex bails on the mortgage, or sells it for way less than is owed, the bank will come after YOU to make them whole.
    Per the OP she did not sign the quit claim deed. Her ex wanted her to before the refi, she very smartly refused.



  7. #7
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    Quote Originally Posted by gieriscm View Post
    Per the OP she did not sign the quit claim deed. Her ex wanted her to before the refi, she very smartly refused.
    However, her ex has not refinanced the property, which means that the bank can still come after her in the event he does not keep the mortgage current.
    **********
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  8. #8
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    Default

    I responded to the other thread. My ex remains on our mortgage.

    However, my attorney admitted that usually the two attorneys draw something up that can be used to take the non-residing ex off the mortgage. But my ex's attorney was so incompetent, he didn't follow through and get this done. My attorney didn't bother to, since I didn't request it of him, and since he had to punt for them several other times along the way.

    Ask your attorney if this is something that should have been done in your matter. Good chance it's just another detail that "got overlooked".
    Being right half the time beats being half-right all the time. Malcolm Forbes



  9. #9
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    lucassb is spot on the money. Get a different attorney, pronto!!!
    Last edited by oliverreed; Oct. 30, 2012 at 02:40 PM. Reason: typo
    What's wrong with you?? Your cheese done slid off its cracker?!?!



  10. #10
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    Default

    Plus, if he doesn't refinance it, it will be calculated into your debt to income ratio if you ever try to buy something on credit. It doesn'tmatter what the divorce agreement says. Contractually, you are still on the note.


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  11. #11
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    A friend of mine has to pay to have her name taken off the mortgage now that she and her husband are divorced ( he has the house too). It will cost her $ 600. The problem is, that if for some reason he does not continue to have excellent credit, or pay his mortgage you will be affected since your name is on the mortgage. If they can't collect from him, they will come looking for you.



  12. #12
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    Quote Originally Posted by Lucassb View Post
    However, her ex has not refinanced the property, which means that the bank can still come after her in the event he does not keep the mortgage current.
    Oh I know! At least she's not in the unenviable position of owing on a property she doesn't have title to, which happens all too often.

    That said, since the ex is under a court order to pay, if he fails could the OP have him charged with contempt? That threat alone might be enough to light a fire under him to get him moving on the refi.



  13. #13
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    Contact a lawyer-

    You said you signed an Assumption Agreement, that is where a borrower (your husband) assumes the debt of the original borrower (you).

    If it is in "recordable form" demand that the bank record it, or get another original and record it in the public records yourself.

    This will remove you as a borrower under the recorded Mortgage or Deed of Trust.


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  14. #14
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    Quote Originally Posted by gieriscm View Post
    That said, since the ex is under a court order to pay, if he fails could the OP have him charged with contempt? That threat alone might be enough to light a fire under him to get him moving on the refi.
    That's sort of what I'm thinking, too. He actually threatened *me* with a court order for contempt because I refused to sign a quit claim deed and he said I was "refusing to surrender the estate to him." Btw, I moved out the week after we decided to divorce, I paid the mortgage for the next month because I'm in the Army and required to ensure he's supported, and then worked out a deal with him until the divorce was final and I was no longer required by the military to support him.

    I honestly don't understand why you wouldn't immediately refinance after a divorce? I could go out and get a second mortgage with the same mortgage company and default and he's be liable too. It just makes no sense to me.
    “Thoroughbreds are the best. They’re lighter, quicker, and more intelligent.” -George Morris



  15. #15
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    Were you represented by an attorney in your divorce? If so, you need to contact him or her and ask this question. If not, contact a divorce lawyer and arrange a consultation. Yes, you need to be worried about this and need to resolve the situation quickly.



  16. #16
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    Thanks, Appsolute. I'll see if I can do that.
    “Thoroughbreds are the best. They’re lighter, quicker, and more intelligent.” -George Morris



  17. #17
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    Quote Originally Posted by Lucassb View Post
    However, her ex has not refinanced the property, which means that the bank can still come after her in the event he does not keep the mortgage current.
    Quote Originally Posted by gieriscm View Post
    Oh I know! At least she's not in the unenviable position of owing on a property she doesn't have title to, which happens all too often.

    That said, since the ex is under a court order to pay, if he fails could the OP have him charged with contempt? That threat alone might be enough to light a fire under him to get him moving on the refi.
    Quote Originally Posted by Wholehearted View Post
    That's sort of what I'm thinking, too. He actually threatened *me* with a court order for contempt because I refused to sign a quit claim deed and he said I was "refusing to surrender the estate to him." Btw, I moved out the week after we decided to divorce, I paid the mortgage for the next month because I'm in the Army and required to ensure he's supported, and then worked out a deal with him until the divorce was final and I was no longer required by the military to support him.

    I honestly don't understand why you wouldn't immediately refinance after a divorce? I could go out and get a second mortgage with the same mortgage company and default and he's be liable too. It just makes no sense to me.
    The key is what is in the settlement agreement. If it simply states that the property is awarded to the ex, without mention of how the mortgage is to be paid, then there is nothing to hold the ex in contempt about. In other words, there has to be a requirement to refinance within the document and a failure to heed that directive in order to go after your ex for failing to do so.

    Hopefully the language in the settlement agreement states explicitly that the ex is awarded the property, is responsible for all costs, agrees to refinance (although typically all that can *really* be required is for the ex to apply to refinance - since it's the bank that will agree or not,) AND indemnifies the OP against any liability for the property, costs etc in the event the ex defaults.

    It's actually very unlikely - perhaps impossible - for you to go out and get a second mortgage on that property, OP. The settlement agreement that documents the fact that the property now belongs to your ex would likely come up in the due diligence process (and getting mortgages now would certainly include such a search) so your ex is probably in no danger at all of you using that property as collateral for any additional debt.

    If he is not legally required to refinance, then there is little incentive for him to do so; it's somewhat expensive, a hassle from a paperwork standpoint, and potentially impacts his credit as it will no longer be a shared obligation supported by two people/incomes. (There may or may not be an emotional component to it as well, but I won't speculate on that.)

    However, until that re-fi is done, that mortgage IS going to show up on your credit report as an obligation and will reduce the credit available to you accordingly.
    **********
    We move pretty fast for some rabid garden snails.
    -PaulaEdwina



  18. #18
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    Quote Originally Posted by Lucassb View Post
    The key is what is in the settlement agreement. If it simply states that the property is awarded to the ex, without mention of how the mortgage is to be paid, then there is nothing to hold the ex in contempt about. In other words, there has to be a requirement to refinance within the document and a failure to heed that directive in order to go after your ex for failing to do so.

    Hopefully the language in the settlement agreement states explicitly that the ex is awarded the property, is responsible for all costs, agrees to refinance (although typically all that can *really* be required is for the ex to apply to refinance - since it's the bank that will agree or not,) AND indemnifies the OP against any liability for the property, costs etc in the event the ex defaults.
    Considering that in most divorces one party or the other ends up with the house, I'm surpised that there isn't standard language to address this.



  19. #19
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    Quote Originally Posted by Appsolute View Post
    Contact a lawyer-

    You said you signed an Assumption Agreement, that is where a borrower (your husband) assumes the debt of the original borrower (you).

    If it is in "recordable form" demand that the bank record it, or get another original and record it in the public records yourself.

    This will remove you as a borrower under the recorded Mortgage or Deed of Trust.
    Definitely contact a lawyer!

    But also remember that most assumption agreements pertaining to mortgages will require the consent of the lender who is affected. If your ex's income is sufficient for him to satisfy the bank, they may agree, but realistically there is not much incentive for them to do so. Right now they have two people on the hook for the outstanding balance; it puts them at greater risk to reduce that to a single person, particularly if you got other assets in the divorce which negatively impacted your ex's financial picture, as is often the case.
    **********
    We move pretty fast for some rabid garden snails.
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  20. #20
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    I have a friend in the same situation. The problem with him is not that his ex is ruining his credit, it's that he is over leveraged on paper. He was able to buy a new house, but he wants to buy an additional piece of property and he can't get financing because it looks like he is in debt for his own new house and the old one now owned by his wife. Of course, legally he is in debt for both. He wants to get his name off that other deed to free up his borrowing ability.

    I think this is the big worry you will have as well, because if your ex has good credit, he will probably want to keep it that way. Your main worry will then be freeing up your own finances to borrow on something of your own.



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