Tenants in common - refinance issues

[mcourville]

What is the name of your state? Massachusetts

In 1999, myself & husband, my sister & husband and a third party (my child's godfather) bought a 3 family house together as tenants in common; it is completely owner-occupied. We all agreed that each party would be responsible for one-third of the mortgage payment and we all owned one-third of the house. My sister and I both ended up divorcing, and we both received our husband's shares in the house in the divorce settlements. Both signed quitclaim deeds have been filed with the county Registry of Deeds.

Now we need to refinance the mortgage for a variety of issues:
1. The names on the deed and the names on the mortgage don't match. I was told that we have been very lucky that the bank hasn't called the note as of yet.
2. The bank has the property address wrong - the original mortgage lender somehow got the property address wrong on half the closing papers (I can't figure out how that was missed by any of the people involved).
3. DOR has placed a lien on the mortgage because my ex-husband's name is still on it. DOR told me they did that because it was done by social security #, it didn't matter that his name was no longer on the deed. They did tell me that by either refinancing or doing an assumption to get his name off, the lien would be cleared.
4. We need some repairs done on the home - roof, porches, doors, etc.

My sister & I don't have any problems with refinancing. I spoke to the third owner about the reasons for needing to refinance and he said he was ok with it. I looked into refinancing with the bank that holds the original mortgage and they put together a package for us - the refinanced mortgage and line of credit with our equity - and told me what needed to be done to move forward on it. (Note: my sister's name would not be on the refinance at this time, her credit would end up giving us a much higher interest rate, but we would be able to add her on in a couple years when it repairs).

When I spoke to the third owner again to give him the details of what the bank was offering us, he told me that he wouldn't sign for anything at this time because he had just been diagnosed with cancer and it would affect his health care benefits. Then he did a complete about-face and told me that he pulled a copy of the original deed and my and my sister's ex-husbands were the owners, not us. We had told him after our divorces that we were granted the shares in the house, and I reminded him of this as well as showed him my copy of the quitclaim deed that was filed - he still did not believe me.

I have tried to get the third owner to sit down with a lawyer to discuss all the issues but he will not, he says he needs his own representation.

Now that the deal has fallen through, I have been informed by the bank that if we don't get the house refinanced they will either call the loan or tax us for up to three years advance mortgage payments plus a full year of homeowners and property taxes. They said we have until June 15th, and if nothing is done by then, the mortgage will be sent over to the foreclosure department to start proceedings.

I have explained all this to the third owner, but he is not hearing anything that is being said to him. Now we are facing losing our house because the issues above could not be resolved. Do my sister and I, as the two other tenants in common, have any options here so we can save our house??

I apologize for the long post, I have tried to compact all the facts the best that I could but it is a really difficult situation to explain. Thanks in advance for any replies to this post.

~MCWhat is the name of your state?

[lcannister]

If you do not want to come up with a lot of money or perhaps even lose the property if proper deeds are not filed you need to see an atty versed in real estate as quickly as possible. The bank is serious and unless you can get someone involved who knows the laws and can figure out true ownership you will need money.

Real bad idea to let sis slide from being on the mortgage but hold rights to the property!

[mcourville]

We don't have a lot of money to come up with if they chose to tax us for the advance mortgage payments. As far as my sister is concerned, I was going to have some kind of document drawn up stating she is financially responsible for one-third of the mortgage until her name could be added onto it, at least if it is possible to do.

I had gone to see a local lawyer who wanted to sit down to work on this with everyone concerned, but when the third owner decided he didn't want to cooperate with us the lawyer told me it was out of his area of expertise and we would need to find someone else. I also asked him if he could recommend someone and he said to look in the yellow pages and basically hung up on me. Now I feel like we're back to square one, only with a lot less time to try to resolve anything.