DH & I With Accepted Offer & His House Is For Sale

[swoosh]

Hi,

 

Just want to get some clarification here, although I'm thinking I already know the answer. About a year ago my DH and I knew that he would be retiring sometime in the next year or so (he just did 2 weeks ago with a nice City pension) and he was somewhat newly divorced (a year ago he was 2 years out from his divorce). I advised him that he should probably get ex's name off the deed to the house in case something happened, or in case we wanted to sell the house, we'd be ready to go. So DH got a HELOC and paid her off for her portion of her equity (and also negotiated a nice discount because she got her money earlier than what they agreed to in their divorce decree, by about 5 years). We had our lawyer do the quit claim deed documents, they both signed, and it was filed with the court, so since a year ago, only his name is on the house.

 

Meanwhile, I keep seeing the first mortgage loan bill come in every month with both of their names on it. And frankly, she's benefiting from him paying on-time every month (and it's not a huge mortgage, only $53K right now). He has perfect credit, so it's not hurting her in any way.

 

We get a frantic call from her today asking for a copy of the quit claim deed (something I'm sure we can lay our hands on, or tell her to get a copy from the courthouse), but my question is this ... she's going for a refi on her townhouse. Her bank must be asking for this. She just bought the townhouse sometime in the past 2 years. I can't believe her first mortgage lender wouldn't have wanted her name off DH's mortgage back then, but I'm not sure what kind of financing she had either. Won't her new lender REQUIRE her to have her name removed from DH's mortgage (unless her income can support both her loan and his)? Or perhaps she has an FHA loan (I really don't know), and then maybe it wouldn't matter?

 

We're both sure that no where in their divorce decree did it ever state he HAD to refinance to get her name off of the loan (we read it thoroughly recently due to his pension issues before he retired). It really didn't address the house except for the amount and timing of what he needed to pay her (which is done now).

 

Also, we have an accepted offer on a house ourselves, and DH's house is up for sale, so there's no way he's going to refinance just for her when the sale of his house is imminent. Obviously if DH's house sells soon, it would resolve her dilemma. Just want to make sure we can't be "forced" into refinancing if it's definitely not in their divorce decree to do so. By the way, she did not have a great attorney, and my ex was pro se, so I think it was just something neither one of them considered.

 

Thanks much!

[liverichly]

In your husbands ex-wife's situation her lender would just usually need to see that the mortgage was being paid on time, and that in the divorce decree your husband was awarded ownership of the home. However an underwriter might want to also see she no longer owns that home, and the name just happens to still remain on the mortgage, thus needing a copy of the quit claim deed to confirm that fact. If it's not in the divorce decree that your husband had to refinance the mortgage solely in his name then I don't see how that could be forced upon him.