Buying Out STBX from Family Home w/ active Foreclosure

[PhilE]

What is the name of your state (only U.S. law)? WI

So the situation is that I am living in the family home.

The note is in my name only, the title is in both names.

In the last week a civil case was opened w/ both parties as defendants for the foreclosure

An appraisal was completed this month and a value given that we both agree to.

She is understandably upset that this is open against her.

My position is that this is not hurting her credit score wise as its all in my name...i have a couple of things in process w/ the lendor to rectify the situation...so i want to continue forward w/ buying her out at the appraised value (final meeting to sign MSA is scheduled for 10/16), she can remove herself from the title and she is then removed from the foreclosure. To me this would be the fastest method of removing her from the situation.

Her lawyer is saying the property needs to go on the market now....to me as i'm willing to move forward and buy her out at the appraised value this seems like bad advice.

However i don't know what issues there would be with removing her from the title mid foreclosure. Are there any ??

Thanks for any info you can provide.

Phil

 

[LdiJ]

What is the name of your state (only U.S. law)? WI

So the situation is that I am living in the family home.

The note is in my name only, the title is in both names.

In the last week a civil case was opened w/ both parties as defendants for the foreclosure

An appraisal was completed this month and a value given that we both agree to.

She is understandably upset that this is open against her.

My position is that this is not hurting her credit score wise as its all in my name...i have a couple of things in process w/ the lendor to rectify the situation...so i want to continue forward w/ buying her out at the appraised value (final meeting to sign MSA is scheduled for 10/16), she can remove herself from the title and she is then removed from the foreclosure. To me this would be the fastest method of removing her from the situation.

Her lawyer is saying the property needs to go on the market now....to me as i'm willing to move forward and buy her out at the appraised value this seems like bad advice.

However i don't know what issues there would be with removing her from the title mid foreclosure. Are there any ??

Thanks for any info you can provide.

Phil

If the house in is foreclosure now, how do you think that you are going to be able to refinance to buy her out? If you couldn't manage the current payments on your own, how do you think that you are going to be able to qualify for enough of a mortgage to buy her out?

I agree with her attorney. The house needs to go on the market now.

 

[PhilE]

If the house in is foreclosure now, how do you think that you are going to be able to refinance to buy her out? If you couldn't manage the current payments on your own, how do you think that you are going to be able to qualify for enough of a mortgage to buy her out?

I agree with her attorney. The house needs to go on the market now.

The note is in my name only, no refinance is required. There is significant marital debt that would balance out her share in the minimal equity, i have enough in my 401k to cover what i would need to pay her.

 

[seniorjudge]

The note is in my name only, no refinance is required. There is significant marital debt that would balance out her share in the minimal equity, i have enough in my 401k to cover what i would need to pay her.

I'm confused.

I couldn't find anywhere you talking about how you were going to pay the lender off in full to stop the foreclosure.

Explain.

Thanks.

 

[PhilE]

I'm confused.

I couldn't find anywhere you talking about how you were going to pay the lender off in full to stop the foreclosure.

Explain.

Thanks.

basically i have applied for what my lender calls a loan modification, whereby they ask for a % of the outstanding payments (which i paid 30 days ago) and then review your budget and if they approve you they take the remaing outstanding payments and any accrued foreclosure costs and bury it back into the principal, your interest rate and loan term stay the same but your payment goes up....for the amount I pay it would go maybe 30 or 40 bucks a month.
This is obviously not a guaranteed process but the banks are working hard to avoid foreclosure and they person at the lendor said my budget looked good for an approval.

 

[seniorjudge]

I understand now. Thanks.

Modifications can work wonders.

As far as getting her off the title, that will have to happen either in your lawsuit or after the judgment in that lawsuit.

But, of course, you need to check all this out with your lender.

 

[PhilE]

I understand now. Thanks.

Modifications can work wonders.

As far as getting her off the title, that will have to happen either in your lawsuit or after the judgment in that lawsuit.

But, of course, you need to check all this out with your lender.

so from a legal standpoint the open civil case and the associated "lis pend.." (second as the divorce generated one also) would not preclude removing her from the title if the judge ordered it.

 

[seniorjudge]

so from a legal standpoint the open civil case and the associated "lis pend.." (second as the divorce generated one also) would not preclude removing her from the title if the judge ordered it.

I am not sure what your question is.

The foreclosure lawsuit will have to proceed with both y'all since it was started when she owned an interest in the land.

The divorce lawsuit is where her legal interest in the land may be extinguished.

 

[PhilE]

I am not sure what your question is.

The foreclosure lawsuit will have to proceed with both y'all since it was started when she owned an interest in the land.

The divorce lawsuit is where her legal interest in the land may be extinguished.

understood

So now with all this being said is it still in her best interests to insist that the house be placed on the market (and with a 50% interest in the property can she even do that ?)

 

[seniorjudge]

Q: So now with all this being said is it still in her best interests to insist that the house be placed on the market (and with a 50% interest in the property can she even do that ?)

A: I wouldn't have the slightest idea; I haven't heard her side. But if you are truly working toward a modification and your lender thinks you may get that, then that will sure be a lot quicker than listing it for sale. Just a guess...

 

[PhilE]

Q: So now with all this being said is it still in her best interests to insist that the house be placed on the market (and with a 50% interest in the property can she even do that ?)

A: I wouldn't have the slightest idea; I haven't heard her side. But if you are truly working toward a modification and your lender thinks you may get that, then that will sure be a lot quicker than listing it for sale. Just a guess...

I would think so also

Thanks for all the info.

 

[tuffbrk]

As long as she is compensated for her 50% interest in the equity no one should care.

 

[LdiJ]

I still have the concern that if he couldn't handle the payments and the house went into foreclosure, how is he going to handle the payments even if they are only slightly higher?

He hasn't explained why the house went into foreclosure, and why a renegotiated loan will solve the problem.

Of course he is not going to be required to explain that to us, but he will be required to explain it to the judge if the ex and her attorney don't agree.

 

[Ronin]

If the note is not in her name a quitclaim may be an appropriate and simple remedy. Check with a real estate attorney.

 

[mistoffolees]

Her lawyer is saying the property needs to go on the market now....to me as i'm willing to move forward and buy her out at the appraised value this seems like bad advice.

I'm inclined to agree with her lawyer, but for a different reason than the one given by others.

Since her name isn't on the note and you're prepared to buy out her share of the equity based on the appraisal, there are three possible objections:

1. She may just emotionally object to you getting the house. If so, she's going to make your life h*ll and drag things out so it will cost you much more in the end. To counter that, I would offer to let her keep the house if she can afford to buy you out - basically, call her bluff. She may back down at that point.

2. The attorney may feel that you don't have the ability to buy out her share of the equity. To counter this, you would need to demonstrate that you have the ability to do so IN CASH and free her from any obligations.

3. (my hunch is that this is closest to the truth). She and/or her attorney may believe that the house is worth much more than the appraisal you gave them. Although you say you both agree to it, maybe she really thinks it's worth more. To counter that, you might have to give her a bit more than her strict share of the assets.

In any event, your next step is to simply ask them why they object to you buying her out. Once you know the real answer, you can come up with a response. As it is, you're trying to work out a plan of action based on guesses.