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oldblueeyes

Divorce - personal loan needed

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Hello all,

 

My divorce was just finalized at the end of April. As part of the judgement I am required to try to get 2 debts in my name (or pay them off) and my ex-husband is responsible for all remaining debts. I applied for a personal loan through my credit union (BCU) and was denied due to debt to income. I make 60k and my ex makes 105k. Any suggestions on how to get at loan for at least the two required debts in my name? Ideally I would like to get the debt I accumulated the last year as part of the personal loan/debt consolidation too.

 

I have  no late payments or anything negative on any of my reports. My FICO 8 score through Experian is 732. The BCU loan rep told me my Vantage Score (which is what they use) was coming back at 650.

 

Accounts on my reports:

Wells Fargo Mortgage - 162k - ex is required to refinance in only his name

Greenstone (recreational) Mortgage - 47k - ex is required to finance in only his name

Honor (Side by side UTV) loan - 16k - debt is only my husbands according to divorce judgement

Flagstar personal loan - 13k - debt is only my husbands according to divorce judgement 

Wells Fargo CC - 15K - I am required to pay off 10k of this

Chrysler Capital - 8k - MY vehicle lease

BCU credit card - 4800 - credit card in only my name

Chase credit card - 2000 - credit card in only my name

 

I am also required to pay 2,500 toward another credit card that is only in my ex name.

 

I will take any advice on a loan to at least get my ex/judgement ($12,700) squared away. Any thoughts why my Equifax FICO 8 is 732 but the credit union uses a product that shows 650?

 

THANK YOU!

 

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The judge presiding over the divorce proceeding lacks the legal ability to make unilateral changes to contractual liability.  I hope that your attorney has provided notice to the various card issuers so that they have an opportunity to respond. 

 

When your soon-to-be-ex defaults on any amount for which you had joint responsibility under the contract, your credit will be screwed and you have no recourse with the exception of seeking to have the Court hold him in contempt.  However, that does nothing to repair the damage that will have ensued. 

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There are a few things here.  Echo Centex's comments, and you need to keep on top of it.

 

The problem here is that you have a lot of liabilities shown against your income which you are still contractually responsible for.  Any of those debts you list above you are still responsible for, irrespective of what the judge said, and they will be counted against your DTI.  Credit Unions tend to look much more closely at DTI, thus the rejection is not surprising.  

 

As far as the difference in scores, every lender uses their own model, which can vary significantly from what you see as your FICO score (not to mention you say Experian in the upper part of your post and Equifax in the lower part, which is it?). 

 

How quickly do you need to get these things paid off?  Is there someone you could possibly borrow the funds from, and then assuming your ex follows the judges decree and re-finances those debts in his name only, you can then get a personal loan to pay them back?  

 

Another option is you can get a 0% credit card that allows balance transfers and transfer the balances on the card to the new account.  This of course assumes you have access to the existing account number.  Otherwise some issuers (like Citibank and BoA) allow transfers to your checking account.

 

Another potential option would be to take a loan from a 401(k) if you have it.  I don't really like this option given the potential loss of earning growth, but if you really want to get this behind you so you can be done with it, you can explore that avenue if available.

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My apologies, it is Experian!

 

My ex and I are responsible with our money in the sense that we are never late on payments and understand the importance of credit (we just spent too much)! I do believe he will get the two real estate pieces re-financed out of my name ASAP. I also trust he will keep current on the other debt and work to get into just his name as well.

 

For the other debt it says we will both work to get the debt paid or in our names within 90 days. And, yes, it is my understanding that the judgement literally means nothing as our creditors will jointly hold us responsible unless refinanced in one of our names.

 

Do you think having the real estate off my credit report will be significant enough (Wells Fargo monthly $1300 payment and Greenstone $300) that a personal loan is more likely? Or will the other debt still hold me back?

 

Also, borrowing from someone or 401K is not an option.

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Well, the crystal ball isn't back from the repair shop, so it's rather difficult to say what banks will do. Keep trying. As per your divorce decree, it is meaningless to your creditors since they are not a party to it. Hopefully you are not in a community property state, which would just about invalidate the thing.

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15 hours ago, oldblueeyes said:

Do you think having the real estate off my credit report will be significant enough (Wells Fargo monthly $1300 payment and Greenstone $300) that a personal loan is more likely? Or will the other debt still hold me back?

It will certainly help as it will reduce your liabilities.  If I were you I would try to go the CC BT route to pay off the debt, as it will likely be the path of least resistance.  Of course this assumes you have access to the CC numbers of the cards to be paid off. 

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7 hours ago, ubercat said:

Trusting an Ex to have your best interests in mind is absolute folly.

I am not foolish enough to think he has MY best interests in mind. I believe he will not default on things because it is in HIS best interest. Just because he is my ex doesn’t mean he is a bad person or is going to suddenly become irresponsible.

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11 hours ago, CTSoxFan said:

It will certainly help as it will reduce your liabilities.  If I were you I would try to go the CC BT route to pay off the debt, as it will likely be the path of least resistance.  Of course this assumes you have access to the CC numbers of the cards to be paid off. 

Thank you for your suggestion, I appreciate it!

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Posted (edited)

Remember that there is a lag with credit reporting. 

 

If when if your ex-husband refinances or repays any of the debts that are also reporting on your credit, it could take another 30 days or more before the $0 balances are reflected on your reports.

 

Since you have a 90-day window to repay the accounts that are your responsibility, be mindful that if he repays his accounts anywhere close to day 90, the balances will still be showing on your reports when you apply for other credit.

 

 

Edited by cv91915

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9 hours ago, oldblueeyes said:

I am not foolish enough to think he has MY best interests in mind. I believe he will not default on things because it is in HIS best interest. Just because he is my ex doesn’t mean he is a bad person or is going to suddenly become irresponsible.

 

The last time I ever heard someone make a statement like that was ... never.

 

I admire your whatever it was that inspired you to say that.

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The first step I recommend is a constructive conversation with a senior loan officer at your credit union.  Explain the circumstances and clarify whether the debt that your husband is required to assume is what's presently preventing you from obtaining your loan approval.  (I assume it is.)

 

Next, explain that you're under time constraint in refinancing the debt you've agreed to assume.  Inquire whether it's possible to avoid delays related to credit agency reporting by providing documentation of debt repayment by your husband as it occurs.

 

Some here have jaundiced credit union experiences.  However, I've been with my current credit union for 38 years, and what I most value is the opportunity to build a personal relationship -- sometimes permitting "special handling" when circumstances warrant it.

 

In any case, the 90 day deadline set by the court is clearly impractical.  It might be appropriate having your lawyer reset a deadline with the judge that reflects the specifics of your situation.

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13 hours ago, oldblueeyes said:

I am not foolish enough to think he has MY best interests in mind. I believe he will not default on things because it is in HIS best interest. Just because he is my ex doesn’t mean he is a bad person or is going to suddenly become irresponsible.

NEVER underestimate what a now-ex (or even soon-to-be-ex's) will do.  I have seen more than one case where one party deliberate dragged proceedings and mediations out precisely to eat up assets that might otherwise have to be split.  Two of the attorneys in my building do family law, with one doing mediations on an almost daily basis...it is NOT an uncommon event, no matter how 'nice' the person might have been while the relationship had still been intact... 

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4 hours ago, PotO said:

 

The last time I ever heard someone make a statement like that was ... never.

 

I admire your whatever it was that inspired you to say that.

I know a couple that divorced 8 years ago and they weren't hostile. They just turned out not to be compatible. They agreeably split their assets over the next year. Maybe not that common. I've heard horror stories but they are the only couple I know personally that divorced.

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On 5/16/2019 at 9:08 AM, oldblueeyes said:

My FICO 8 score through Experian is 732. The BCU loan rep told me my Vantage Score (which is what they use) was coming back at 650.

 

Very few lenders use Vantage scores; FICO 08 is by far the most popular. Try a different bank or CU...

 

A FICO 08 of 732 is pretty respectable so I'd be surprised if you don't get approved somewhere for a loan and/or a 0% intro CC.

 

Just to be sure, I would first check your FICOs at all 3 major CRAs and target a lender who pulls the best one (see CREDITPULLS). The majority of CUs seem to prefer EQ, except in California where many pull EX.

 

 

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7 hours ago, centex said:

NEVER underestimate what a now-ex (or even soon-to-be-ex's) will do.  I have seen more than one case where one party deliberate dragged proceedings and mediations out precisely to eat up assets that might otherwise have to be split.  Two of the attorneys in my building do family law, with one doing mediations on an almost daily basis...it is NOT an uncommon event, no matter how 'nice' the person might have been while the relationship had still been intact... 

 

+ 1 million.

My fiscally responsible ex-h, when we were divorcing, refused to pay a counseling bill (which had my name at the top because it was on my insurance). Counselor never contacted me, and by the time I learned about this, the counselor had taken it to collections. I didn't find out until it was too late to bring it back to the counselor (who refused to accept payment or arrangements. I think he was upset with me too). Of course, this was years before CB and online credit reporting. By the time I talked to an attorney, disputing it was out of the question because I stupidly agreed to payment arrangements, which stuck it to my CR.

My perfect credit report, which I relied on to survive as a former SAHM, was stained. Six months later, when my other accounts (also in perfect condition) did SPs, those got shut down or CLD'd.

Please, OP, do what you need to do to ensure that nothing can happen to your credit score. I was convinced that my soon-to-be-ex wouldn't do what he did. Good luck to you.

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I would shoot for a 0% BT credit card rather than a personal loan.

I have a score around 790-800 and the one time I thought a personal loan was a better idea than a cc... they came back with 12.99%

I went to Citi and they gave me the $5000 at .99% for 18 months.

 

 

 

 

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On 5/17/2019 at 5:47 PM, oldblueeyes said:

I am not foolish enough to think he has MY best interests in mind. I believe he will not default on things because it is in HIS best interest. Just because he is my ex doesn’t mean he is a bad person or is going to suddenly become irresponsible.

 

Yeah.  I bet you ten bucks you're wrong by the end of the year.

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