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  1. #1
    GingerAle916 is offline Junior Member
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    Red face Ex Husband won't refinance home. What now?

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

    My ex and I have been divorced since April 2010. In the divorce settlement agreement, he paid me for the condo we shared and was supposed to refinance in 6 months (by Oct 2010). He still hasn't, and I didn't think at the time to ask the judge what my next step was if he didn't. What is my next step? I'm still on the loan and title, although he has been making all the payments on time. Thank you!
  2. #2
    LdiJ is online now Senior Member
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    Quote Originally Posted by GingerAle916 View Post
    What is the name of your state (only U.S. law)? California

    My ex and I have been divorced since April 2010. In the divorce settlement agreement, he paid me for the condo we shared and was supposed to refinance in 6 months (by Oct 2010). He still hasn't, and I didn't think at the time to ask the judge what my next step was if he didn't. What is my next step? I'm still on the loan and title, although he has been making all the payments on time. Thank you!
    First, you determine whether or not its possible for him to refinance. He would need to have at least 20% equity at current market value in order to do so. Does the property have that much equity? Does he have the income and the credit to get approved for a mortgage loan?

    Once you have determined that it IS possible for him to refinance, then you take him to court for contempt for not obeying the court orders.
  3. #3
    mistoffolees is offline Senior Member
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    Quote Originally Posted by LdiJ View Post
    First, you determine whether or not its possible for him to refinance. He would need to have at least 20% equity at current market value in order to do so. Does the property have that much equity? Does he have the income and the credit to get approved for a mortgage loan?

    Once you have determined that it IS possible for him to refinance, then you take him to court for contempt for not obeying the court orders.
    Even if there's less than 20% equity, she can still take him to court for contempt. The court order presumably doesn't say he has to refinance if it's convenient to him.

    He may have to bring additional cash to the table to make it possible. Or get a co-signer. Or, if that's not possible (or if his credit rating is not adequate to refinance), sell the condo.

    It's a court order, not a suggestion.
  4. #4
    nextwife is offline Senior Member
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    Quote Originally Posted by mistoffolees View Post
    Even if there's less than 20% equity, she can still take him to court for contempt. The court order presumably doesn't say he has to refinance if it's convenient to him.

    He may have to bring additional cash to the table to make it possible. Or get a co-signer. Or, if that's not possible (or if his credit rating is not adequate to refinance), sell the condo.

    It's a court order, not a suggestion.

    Even so, the court order does not control the LENDERS. This is a CONDO. If the development is tetering, has too high a percentage of foreclosures, too low a reserve, too many rented units, or any other underwriting issue, even with 20, 30 or 40%, there may not be a lender willing to write in there at this time.

    The court order cannot make a lender lend there.
  5. #5
    mistoffolees is offline Senior Member
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    Quote Originally Posted by nextwife View Post
    Even so, the court order does not control the LENDERS. This is a CONDO. If the development is tetering, has too high a percentage of foreclosures, too low a reserve, too many rented units, or any other underwriting issue, even with 20, 30 or 40%, there may not be a lender willing to write in there at this time.

    The court order cannot make a lender lend there.
    Absolutely. As I said, even if he can't refinance, she can ask the court to order the house sold.
  6. #6
    nextwife is offline Senior Member
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    Quote Originally Posted by mistoffolees View Post
    Absolutely. As I said, even if he can't refinance, she can ask the court to order the house sold.
    Which becomes problematic if the lenders won't lend there right now. That means that the only option is a cash buyer.
  7. #7
    SESmama is offline Member
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    He could always see if a mortgage assumption is possible
  8. #8
    nextwife is offline Senior Member
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    Quote Originally Posted by SESmama View Post
    He could always see if a mortgage assumption is possible
    And how would that serve her goal of getting OFF the mortgage entirely and having it paid off at either a refi or sale closing? It's even worse that he having control because then a third party controls the property with the mortgage still open.
  9. #9
    mistoffolees is offline Senior Member
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    Quote Originally Posted by nextwife View Post
    And how would that serve her goal of getting OFF the mortgage entirely and having it paid off at either a refi or sale closing? It's even worse that he having control because then a third party controls the property with the mortgage still open.
    No, I think it would work. A mortgage assumption would mean that the bank would transfer the mortgage solely into his name - without going through a full refinancing. Her name would be off the mortgage and the bank would no longer have any recourse against her.

    It would not get her any cash back - but she didn't mention that as an issue.

    The problem is that unless there's significant equity and/or he's a great credit risk, the bank probably wouldn't do a mortgage assumption if they won't refinance in his name.
  10. #10
    nextwife is offline Senior Member
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    It's very rare that an assumption THAT INCLUDES A FULL RELEASE of liability by the original borrower is granted. Most assumptions, if even allowed, do NOT release borrower liability. In any event, one needs to know for certain that liability release would occur. I'd be very surprised to see it happen.

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