Posted on: 03rd Apr, 2010 04:03 am
i just got divorced and in our agreement it states that my wife will become the owner of the house and she needs to refinance it. however, she is now telling me that she talked to our lender who told her that she can get a release of liability for me and she can have our loan modified afterwards. my questions are:
1) is there any disadvantage for me to get this release of liability, instead of getting her to refinance (assuming she will be approved for both cases)?
2) how long does it take getting this release of liability?
3) what is the process?
4) do i need to sign quit claim before she applies for this release of liability, or can we do it at the same time?
5) if she chooses refinance, do i need to sign quit claim before she applies for refinance or can i do it at closing?
in case it matters, we are in connecticut.
thanks.
1) is there any disadvantage for me to get this release of liability, instead of getting her to refinance (assuming she will be approved for both cases)?
2) how long does it take getting this release of liability?
3) what is the process?
4) do i need to sign quit claim before she applies for this release of liability, or can we do it at the same time?
5) if she chooses refinance, do i need to sign quit claim before she applies for refinance or can i do it at closing?
in case it matters, we are in connecticut.
thanks.
Hi greg,
Rather than getting a release of liability, it is a better option to let her refinance the loan. Once your name is removed from the loan, you won't be responsible for the mortgage payments and it won't impact your debt to income ratio while you apply for a loan.
Signing a quit claim deed will remove your name from the property deed. Thus, you won't remain the owner of the property but you would be responsible for the mortgage payments unless she refinances the loan in her name. It is better to sign over the deed at the time of closing.
Rather than getting a release of liability, it is a better option to let her refinance the loan. Once your name is removed from the loan, you won't be responsible for the mortgage payments and it won't impact your debt to income ratio while you apply for a loan.
Signing a quit claim deed will remove your name from the property deed. Thus, you won't remain the owner of the property but you would be responsible for the mortgage payments unless she refinances the loan in her name. It is better to sign over the deed at the time of closing.