Posted on: 08th Sep, 2009 03:41 pm
so, i'm having difficulties getting my ex-wife to agree to a short sale of the former marital home.i need to get her name removed from the heloc, and my onlyoption at this point is to sell. her name is not on the first mortgage, or the deed. only the heloc. i tried to give her the 3 options: option 1: we do a short sale, i'm out of the house, she's off the heloc, and we both take a 200-300 point hit on our credit reports(which can be rebuilt quickly). option 2: we don't do a short sale, the regular sale of the house pays off the first mortgage and maybe (hopefully a little bit of the heloc which means i continue to pay off the heloc little by little, over time, and it stays on her credit for the entire time takes to pay off (at least 10 years) option 3: i let the house go into foreclosure, and we all know how bad that can be. her suggestion is to sell the house for whatever i can get for it, use the proceedings to pay off the first, and mybe a little of the heloc, and then once the heloc lender sees that there is no more collateral tied to the loan (i.e. the house) they will be forced to refinance it into a consumer loan thereby removing her name from the note in the process. my question is.. can that happen? can the heloc be converted into an unsecured debt?
Hi dannyrinaldi,
If you go for a short sale, your credit score will be lowered by 75-100 points and not 200-300 points. In case of a foreclosure, your credit score will go down by 250 points.
As far as selling off the property is concerned, you can go for it. But your wife should note, that as there would be no collateral, the second lender will simply charge off the loan to a collection agency who will in turn collect the dues from you. The second lender will not refinance the loan.
Thanks
If you go for a short sale, your credit score will be lowered by 75-100 points and not 200-300 points. In case of a foreclosure, your credit score will go down by 250 points.
As far as selling off the property is concerned, you can go for it. But your wife should note, that as there would be no collateral, the second lender will simply charge off the loan to a collection agency who will in turn collect the dues from you. The second lender will not refinance the loan.
Thanks
I am so ready to sell..... short sale..... just enough to pay off original mortgage. Is it ever possible to turn HEL into a personal loan..... and I will just gladly continue those payments.... just to rid the house because it's in a different city,state.
hi guest!
welcome to forums!
i don't think you would be able to turn the heloc into a personal loan. though you sell off the property, you will be responsible for the mortgage dues. you can contact your lender and get a repayment plan for the loan. this will help you in clearing off the second mortgage dues.
feel free to ask if you've further queries.
sussane
welcome to forums!
i don't think you would be able to turn the heloc into a personal loan. though you sell off the property, you will be responsible for the mortgage dues. you can contact your lender and get a repayment plan for the loan. this will help you in clearing off the second mortgage dues.
feel free to ask if you've further queries.
sussane
Depnding on how much you owe, if you can get a personal loan before you go ahead with yoru short sle, may be it is possible to convert your HELOC in to unsecured loan.
But it may be really difficult after you do short sale or deed in lieu
But it may be really difficult after you do short sale or deed in lieu