Bank wants husbands name only on deed of mutual property owned prior to mortgage appr

[starz]

What is the name of your state?What is the name of your state? NY

I am confused and would appreciate any assistance. My husband and I own a piece of land with no liens (gift from my grandparents at a below market selling price) We are applying for a SONYMA mortgage and because I will not be listed on the mortgage due to bad credit, large debt (previous divorce) and no income (I am a stay at home mom) SONYMA wants for me to gift over the land to my husband so that his name is the only one on the deed prior to mortgage approval. My other option (which is really not an option) is to be included on the mortgage. If I do that we will certainly disqulaify for the mortgage.

I am wondering in signing over the deed to my husband what legal rights and ownership rights do I have to that house if something should either happen to him, or happen to us a partnership. Your advice is greatly appreciated.

[LoanOfficerDan]

I assume that you personally have income, and that this is for a construction loan?

New York has certain Marital Rights laws that say whether your name is on the Warranty Deed or not, you're still an owner. SONYMA has income limits based on household income. If they are removing you because your income throws you over the income limit, that will not solve the problem because you are still part of the household. The only way to "sneak" around the income limit is for you to also divorce your husband before he applies and for him not to tell anyone that you'll be living there.

Secondly, your income will be considered (not for loan approval, but for the SONYMA income limit) whether you're on the note or not. I have never heard of a loan that REQUIRES every owner (owner being defined as "on the warranty deed") to sign the note.

Finally, if you take your name off of the Warranty Deed, you can always add it back right after closing through a Quit-Claim Deed. Again, NY law says that you're a part owner even if you aren't on title.