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If preparing for a divorce, and I need to pay off spouse's part of equity in house, is it better to refinance?

Jul 10, 2007 by Kim M | Posted in Personal Finance

Credit not good. Want to stay in house. Not sure if need to pull out equity or refinance. Attorney suggested to pre-qualify .


Most people take a loan out to do this (a home equity loan). What you are doing is buying him out of his portion of the house you own together. IE if you have 20K in equity if you want to stay in the house you need to pay him 10K. Keep in mind this does not remove him from the mortgage or the property deed it is a gentlemens agreement that he is letting you keep the house in exchange for equity he has helped build by making the payments.

If you want him off the mortgage you would wan to refi the house for the amount of the mortgage right now and the amount of the equity you owe him (so you can still pay him). If you have good credit this is the cheepest way to go about killing 2 birds with one stone!

SCH | Jul 10, 2007

How can one refinance a house with negative equity?

Jun 28, 2006 by fabguy4fn12 | Posted in Renting & Real Estate

My ex wife lives in the house we owned when we were married. Since the divorce, she had to refinance the mortgage due to financial difficulties. Right now I believe she owes more than the house is worth on the open market. She still has financial difficulties having a large amount of debt in addition to the mortgage. Does she have any options in trying to rid herself of this house to move into a smaller, more affordable one? If she sells the house at a loss, is she required to repay the difference back to the bank or mortgage holder immediately? What options might exist for her to rid herself of debt besides bankruptcy?


She should speak with the current mortgage lender regarding a "Short Sale". This type of transaction is used when the house sells for less than the mortgage owed. Yes, the difference must be paid back. A payment schedule is created by the bank. It is a better option than bankruptcy - but will still effect her credit score (or anyone else's score that is on the loan). However, most people who have a short sale are still able to buy another home (while bankruptcy could proclude one from doing that)

JT's Mom | Jun 28, 2006


I own a lot of real estate and deal with banks alot. The bank that holds the loan will not sign off on the loan unless they are paid in full. Her only choice is to continue making payments or file bankruptcy, which may or may not relieve her of the liabilty.
altonbi | Jun 28, 2006


JT's Mom is correct. A short sale is the answer. If she can prove she is poor and has no assets (the divorce helps), chances are she won't have to pay back the loan and they might just issue a 1099c, which looks like she got cash for the difference of what is owed and what was paid on her taxes. They might not do nothing as well.

Regards...
satarnag | Jun 29, 2006


I am a loan officer with Providential Bancorp, a nationwide mortgage lender. Most banks and lendrs will not approve a loan over 100% LTV. But, all lenders are different. We specialize in working with people in similar situations to yours. (Bad credit, 110-125% LTV loans, bankruptcy's in th epast, etc.) Give me a call at 312-264-6448, my name is Jason. I'd be happy to assist you in a refinance..

You can email me at Jasonf@providential.com.

I will be back to my office on Wednesday the 5th, but i will be on my email account through tthe weekend if you would like to talk now!

Either way i hope you enjoy your holiday weekend!

Jason Fry
frymail2005 | Jul 01, 2006

My husband is trying to take the equity/refinance our house without me.?

Jun 20, 2007 by Kay | Posted in Renting & Real Estate

I am in the state of Florida

My husband is planning on leaving me, (other women) We got married in 2002. I had a property at that time in just my name. He went to jail, I sold my property to get him a good lawyer because I know we had the other house. The 2nd house "The marital property" was bought in just his name, even though it was bought after our marriage, my name is not on the deed or the loan. Now he is planning on taking out all of the equity and leave me to pay the bills. Is there anything I can do to stop him from taking out the equity, refinancing or from selling the house without me. According to Fl law I have interest in the property. We have a newborn and he has a son. I was thinking of filing a lien but I am not sure how to do that or if there was another way. Please help!!! I am desperate


Florida is a community property state.
If the property is your primary residence your husband CAN NOT refinance without your signature regardless if you are on the deed.

Lucky you are in Florida, this is not the case in many other states!

The title company will NOT allow a refinance to go through without your signature on the Mortgage. This document puts the property up as collateral, and must be signed by ALL parties with interest in the property. (This document also requires a Notary and two witnesses so him just forging your name is not going to happen)

This rule does not apply for non homestead properties, if he lies to the Title Co/or Attorney, you will have a claim against the property. You will need to contact an attorney

I have seen transactions make it all the way to the closing table without the spouses knowledge.....only to find that the transaction must be cancelled because the spouse is unwilling to sign.

FYI - Almost every county in Florida can be viewed online for Free. If you do a search for Your County in myfloridaclerks.com you can search for all the recorded documents under his name. It it delayed about a week but you can see if a transaction occurred without your knowledge.

Please note, the property must be addressed in your divorce, once you are divorced, you know longer have an interest in the property.

Good Luck to you

***Updated*** Response to Question Addressed to me
I have worked in the state of Flordia as a title officer for about 5 years. Florida is a unique state unlike any other. Not only is it a Community property state, it is also Homestead.

In order for a transcation to be completed by any party. The only way a transaction can occur is if the husband lies and states he is not married or does not live in the property. In both cases, he will have to sign an affidavit to this effect and she can just come back and sue him.

Walking into a closing with a Fl Title Officer or an Attorney. This is the first question asked because the Mortgage MUST show marrital status for a title company to insure. If there is any doubt, the transcation will NOT occur.

To the origianal poster, Contact your local title company and they can explain. Florida is like no other state,

YOU HAVE A INTEREST IN THE PROEPRTY BY MARRIAGE, IT DOES NOT MATTER IF YOU ARE NOT ON THE DEED!

I looked for some info online see this website faq.php

"Florida, Pennsylvania, New Jersey, Ohio, Michigan, California and North Carolina – A signature from a non-titled spouse is required on all lien instruments to be recorded.

greeneyedblond31558 | Jun 20, 2007


Seek advice from and attorney.
Ms. Lady | Jun 20, 2007


you need the best lawyer you can find and you need one
fast. i hope you find one that will find a way to burn your
'dearly beloved's' a** and good! good luck to you. you will
be way better off without him.
agedlioness | Jun 20, 2007


Contact a divorce lawyer to help you through this tricky maze - doing it by yourself is going to make it much more difficult.
Michael K | Jun 20, 2007


Is the house in your name? I dont think he can refinance or equity it without your permission if the house lease or deed is in your name.
goodfella | Jun 20, 2007


Your lawyer should be able to handle this. He can have a judge give a court order that nothing can be done with the property until the divorce is final. that way you will be entitled to your share of the equity before he runs with it. I would act very very fast.
Good luck
frankie b | Jun 20, 2007


Since the house is not in your name you really cant stop him unless you hurry and get a lawyer to stop him. If you are unable to stop the sale, you should be entitled to a portion of the profits in the divorce, especially if you can prove you helped pay the mortgage. If he is only refinancing to get the equity out you be able to get some of that too but you shouldnt be stuck with the mortgage cause you are not legally obligated to pay it at this time.

I wish you well!
da_red12 | Jun 20, 2007


If the house is in his name, he can do it.
Talk to an attorney right away before it's too late (an attorney might figure out a way to do something about it.)
-------------------------------
To the "escrow officer."
And how will the bank even know who else lives in the house?
A guy comes to the bank, where he has mortgage JUST IN HIS name. The bank will give him home equity line of credit without any problems. Then he writes himself a huge check and that's it.
doug0102 | Jun 20, 2007


your problem is twofold. as to your q on the loan - yes he can do that since you state the house is in his name alone - here is the but part - once you file for a divorce he cannot encumber the property by order of the sourt. so time is an issue here, you need to have him served pronto. thank miss m. for making me answer to your question and feel free to email me if you need further advice.
jandrkeller | Jun 21, 2007

Can I use equity in my house when I refinance my loan?

Jul 27, 2007 by magicjumbo | Posted in Renting & Real Estate

For example, if I owe $200,000 and I have $50,000 equity, when I refinance can I use the $50,000 to pay down the amount owed. The new load would then be for $150,000 and I would have $0 equity.


No, your confusing yourself. Suppose your house is worth 250K and you have a loan for 200K.

If you take out a 2nd loan using the 50K equity and use the money to pay down the 200K loan then yes your old loan is now just 150K but since you have a new loan for 50K you still owe 200K total. No matter how you slice it the only way to reduce your debt is to pay it down without taking out new debt.

bull_rooster_aardvark | Jul 27, 2007


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