Posted on: 21st Dec, 2009 07:04 am
divorced my wife in jan of 09. settlement papers give all rights of house to wife & that i grant & convey w/ general warranty title to her & she is solely responsible for all leins, etc. & shall hold me harmless from any liability. she has to take all reasonable steps to remove my name from any liability. if she is unable to remove my name from liability w/in a reasonable period of time, (ie refinance) that we shall renegotiate the provision of removing liability. i signed a quit claim deed in july '09 as the settlement papers stated that each shall endorse all documents necessary to effectuate this provision. she soley has been making payments on the house for over a year and a half as we were separated prior to divorce. now she is falling behind. she has yet to make application to refinance (she will not qualify). what happens to my liability if 1: she cannot continue making payments (i can't make them either)? can the bank come after my ira? house is upside down -more owed than it is worth. 2: what if she files chapter 7 - what is my liability? 3: what if i file chapter 7 prior to a foreclosure? 4: what if it goes into foreclosure? can i file chapter 7 at that time? many thanks for any help!
i suggest you counsel with your attorney to review all your options. i have to admit that i've got no specific expertise in this area.
but having read your circumstance, i must say that this is the kind of situation that makes it evident that the divorce courts in this country are going to have to begin taking into account the mortgage crisis in a new and bigger fashion. lawyers, too, of course, will need to change their ways.
decrees stipulating that a party refinance within a specified timeframe are not realistic in this current economic climate, what with declining values, unemployment at 10% of the populace, and energy prices compounding all that (not to mention all of the other forces in play at the moment). there needs to be more give and take in the divorce proceedings so that each party can be more secure in knowing what can actually take place.
frankly, to expect a former spouse to be able to refinance in these times is like tilting at windmills. i don't see how the lawyers recommend, and the judges rule, that these things need to take place "within a reasonable period of time."
but having read your circumstance, i must say that this is the kind of situation that makes it evident that the divorce courts in this country are going to have to begin taking into account the mortgage crisis in a new and bigger fashion. lawyers, too, of course, will need to change their ways.
decrees stipulating that a party refinance within a specified timeframe are not realistic in this current economic climate, what with declining values, unemployment at 10% of the populace, and energy prices compounding all that (not to mention all of the other forces in play at the moment). there needs to be more give and take in the divorce proceedings so that each party can be more secure in knowing what can actually take place.
frankly, to expect a former spouse to be able to refinance in these times is like tilting at windmills. i don't see how the lawyers recommend, and the judges rule, that these things need to take place "within a reasonable period of time."
i'll be interested to see if there are any other lawyers out there besides our Community Attorney - Brother Heard - who care to opine on this topic. and if there's a judge or two who might have an opinion (and they can certainly be anonymous!), it'd be instructive for all to know that, as well...dontcha think?
I completely agree with what you've said, George. It is true that courts should take into account the present mortgage situation before asking one of the spouses to refinance a loan. This forum is flooded with queries wherein one of the spouse has to face credit issues as the other spouse is unable to refinance the loan and has defaulted on the mortgage payments.
To answer your query guest, as your name is on the mortgage docs, there are chances that the lender can sue you for the dues if your wife is unable to pay it off. However, banks cannot come after your social security income or your retirement income if you are unable to pay off the dues. Your wife can file bankruptcy alone and include the mortgage in it. Your credit will not get affected due to it. However, it will be mentioned in your credit report that the mortgage was included in another person's bankruptcy.
If the property is foreclosed by the lender, then it will affect your credit report negatively. Yes, you can definitely file bankruptcy then. It will put an automatic stay on your lenders and they won't be able to go ahead with foreclosure.
Thanks
To answer your query guest, as your name is on the mortgage docs, there are chances that the lender can sue you for the dues if your wife is unable to pay it off. However, banks cannot come after your social security income or your retirement income if you are unable to pay off the dues. Your wife can file bankruptcy alone and include the mortgage in it. Your credit will not get affected due to it. However, it will be mentioned in your credit report that the mortgage was included in another person's bankruptcy.
If the property is foreclosed by the lender, then it will affect your credit report negatively. Yes, you can definitely file bankruptcy then. It will put an automatic stay on your lenders and they won't be able to go ahead with foreclosure.
Thanks
