Keeping your name on the mortgage

[VIDEO: "What is parental alienation?"]

I feel I should take my name off the mortgage of the current home we own when we divorce. Would there be an advantage of leaving it on? Will this help my credit?

[12years]

I feel I should take my name off the mortgage of the current home we own when we divorce. Would there be an advantage of leaving it on? Will this help my credit?

[GaGrl]

Is your name on the mortgage and the title to the house? You probably cannot be taken off the mortgage unless your STBX refinanced the house with a mortgage in his name only.

Do you have a lawyer? If not, it definitely is time to interview several and select a lawyer who you feel can represent you in dealing with what could be a high-conflict person.

The mortgage question is the type of thing your lawyer will explain for you in terms of all that goes into a settlement agreement.

[livednlearned]

Is he paying the mortgage?

[formflier]

Yeah..look at this from the point of view of the mortgage company.  They currently have two people "on the hook" to pay.

Why would they "release" one from that obligation? 

Hint:  They generally won't unless they get paid off.

FF

[ForeverDad]

I feel I should take my name off the mortgage of the current home we own when we divorce. Would there be an advantage of leaving it on? Will this help my credit?

So he is getting the house?  A good rule of thumb is, if you won't be owning the home then you can't risk remaining on the mortgage.  As Formflier wrote, why 'gift' the lender an extra person to pursue if the ex-spouse stops paying?

Beware of taking a relaxed approach in court.  Ponder what Leverage (generally financial) you can use to enforce an order for him to refinance the property in just his name.  For example, a final decree probably will require you to sign a quit claim deed so he can gain sole ownership.  A smart lawyer (who knows how to handle high conflict divorces) will know not to hand over the quit claim deed until the refinancing is about to happen.  In my case I kept the house and the lawyers didn't hand over the quit claim deed until the very morning I sat down and signed the refi papers.

Oh, and the last thing you want to worry about is your credit score.  Getting stuck with huge potential liability as debtor on a property you don't even own is far worse.

Repeat, if he gets the house then you MUST get off the mortgage, generally requiring a refinance.  If you are to get the house, then it's his worry if he is willing to remain liable on the current mortgage, all you need is the quit claim from him.

[12years]

Thank you all. There are so many factors in every decision. I will get off the mortgage. I don't want him to effect my credit later on since he has trouble paying his rent and utilities at his apartment right now. I just wasn't sure if it helped or hindered MY credit situation. I think getting me off of it is the best decision.

I don't care if the rate goes up that's not my problem. The house is a huge expense and he should consider getting rid of it. I told him this but he will have to figure that out. He doesn't realize he will still have to pay for the maintenance on the house and repairs, and won't be aware until something breaks or leaks and there is plenty of preventative things he could do. I just don't want him not being able to pay child support and for their activities, insurance, etc. because he has to re-do the roof and he will make that a big deal.

[worriedStepmom]

You are making a lot of assumptions.  You are still trying to control the situation, and that's only going to drive you crazy (I promise, I've been there!).  You reallllly need to work on letting go of the outcomes, because, at the heart of it, your STBXH is unpredictable and unreliable.

It's best to work on protecting yourself.   In the case of the house, that means
a) you have it written into the divorce decree that the house must be sold [this is how I did it]
b) you have it written into the divorce decree that he gets the house (and you and the children move out) and that he has to refinance it to get your name off the mortgage by X date.  This has a risk, because if he can't qualify for a new mortgage or chooses not to refinance, you either have to take him back to court, or he can trash your credit by refusing to pay. (This happened to a friend of mine - the house went into foreclosure two years after the divorce, and she was still on the mortgage despite the court order.)

If he ends up with the house, he decides to handle home ownership or maintenance is not your problem.

If he decides not to pay child support, THAT is a problem.  (Not the underlying reason WHY he chose not to pay it, but the fact that he did not pay it.)  You have different solutions to that, depending on your state.  In my state, the state attorney general's office will put deadbeat parents in jail, confiscate their tax refunds, etc. 

You are spending way too much energy trying to close all the loopholes and manage how he lives his life.  You are getting divorced soon.  That means his choices will be totally separate to yours.  He will have to live with the consequences of those. 

Are you working with a therapist on letting go of the need to control the outcomes?  This is oh-so-important in your healing.  It's also really hard to do.

[MeandThee29]

Every situation I've heard of required a refinance to change the names on the mortgage. If he can't qualify, it may be best to sell the house.

Same with a joint car loan. It has to be paid off somehow. Sometimes the lender will refinance with just one person on it, and sometimes they won't. I have a friend who had to roll it over to a credit card to close it out while she tried to find someone to refinance it for her. Ultimately she did find a place that would refinance with additional collateral other than the car. There was a deadline in the decree, so that's how she managed it.

If you can't get this done beforehand, it will go into the divorce decree.

[formflier]

How much equity is in the house?

If there is much or any, I would think it better to sell the house, split the equity and be done with it.

Then...any future real estate that either of you become involved with is completely separate from one another.

You are correct to consider your credit. 


FF

[livednlearned]

I gave my ex the house and wow, not fun. I ended up in family law court four times over his stonewall approach to refinancing. How I could possibly screw him by giving him the house floored the judge and everyone else involved. Eventually the judge threatened sleepaway camp at jail if ex didn't comply with the terms of the order.

Make sure any agreement you make that gets signed into an order has built-in consequences otherwise you will spend a lot of money trying to legally enforce things in front of a judge, who may let your ex have two and three and sometimes four bites of the apple.

Give him deadlines and then explain what will happen if those deadlines are not met, who will pay for what if terms are not met, and so on.

[Turkish]

My buddy divorced his wife and indicated selling the house they had bought together 12 years previously. She wanted to keep it rather than going into a 2 bedroom apartment with their boy and two girls like he ended up doing.  He pays child support and alimony.  Lenders didn't count that income since they desired a history. 

She ended up getting a refi in her name only though it didn't seem like it would happen for a few months.  He was stuck paying rent and the mortgage for a few months. 

The house is a huge expense and he should consider getting rid of it. I told him this but he will have to figure that out. He doesn't realize he will still have to pay for the maintenance on the house and repairs, and won't be aware until something breaks or leaks and there is plenty of preventative things he could do.

My buddy told his wife the same.  He is pretty handy and fixed and maintained a lot when they were married.  She didn't really comprehend that.  Not his problem. Not yours.  She soon found out when she started advertising for a handyman and a plumber. 

[ForeverDad]

If he wants to keep the house, it won't be hard for the court to include the steps you both need to do.  If you are on the deed, you will be required to provide a quit claim deed, wise to structure it to be held in safekeeping with your lawyer and submitted only at the refinancing.  Since you are on the mortgage, you need a clean break and he will have to refinance.  A warning here... No matter how firmly the final decree describes his obligation and your obligations, covering various contingencies, you may come up against the reality that no matter how much you protect yourself and have terms to close loopholes, the court can refuse to actually enforce the terms of the decree.  Yes, courts can and do wimp out.

That's why the best back up strategy is to include additional terms that if the house is not refinanced within X months, then the house must be sold and proceeds (realized equity) split.  You will have to take charge or else he will delay or sabotage endlessly.  Taking charge includes:  You must get possession if you don't already have it.  You must have authority to choose a realtor, list, prep, negotiate and conclude a sale.  You must have the right to require him to sign all required documents to complete the realtor selection, listing and sale.

Frankly, a house is a building.  Home is wherever you live.  Many parents have a desire to hold onto memories but often holding onto a property isn't the best - or even practical - choice.

[formflier]

  You must get possession if you don't already have it.  You must have authority to choose a realtor, list, prep, negotiate and conclude a sale.  You must have the right to require him to sign all required documents to complete the realtor selection, listing and sale.

 

All of this detail should be listed in the divorce decree along with general stuff such as "sign additional documents deemed needed by realtor and closing agent to sell the house"

The clarity is needed so the first time you show up in court to get possession, there won't be much debate.

I would require the sale (should it happen) to be distributed in your favor or done 50/50 with you getting your expenses reimbursed for having to step back in and sell the property.

Goal here is to create a big incentive for the refi to go through.

FF

[MeandThee29]

Yes, the stories are endless. Locals I know had similar issues.

One was self-employed and never was able to get a refinance, so they kept the house joint until she remarried and was able to get it done with both of their incomes.

In my case, I couldn't buy him out and couldn't afford to finance it either. So it was sold.

I actually don't mind renting at this stage. Not sure what I'll do down the road.