When can we Refinance after a Quit Claim Deed

kurisingal · #1 02-02-2008, 03:09 AM

Arizona

I'm adding my wife to the title of an investment property that we want to refinance. the reason being, her credit score is way better than mine and we would like to refinance under her name. I was told that one has to wait 3 months after the change in title before one can refinance.

Is this true?

Grandma's house · #2 02-02-2008, 07:15 AM

Not true at all. In fact she didn't even have to "quit claim" on at all until closing, she is your wife. What would BE the point in the "seasoning" of 3 mos. anyway? That is silly.

In fact...any blood relative you can handle as a refi. vs. a purchase all day long. At close taking off the old (such as a parent and adding the sibling) and no gifting issues but consult with a CPA on the transfer tax of any equity.

CraigFL · #3 02-02-2008, 07:48 AM

This sounds like some artifical condition placed by a lender. Once you record the Quit Claim with the county clerk, it becomes official (or the lender(closer) will do it at closing).

kurisingal · #4 02-02-2008, 07:55 AM

so what i'm hearing is this

1) I currently own the investment property - just my name on the title

2) We get my wife "quit claimed" into the property
3) My wife then applies for refinance right away

OR

2) My wife applies for refinance of the investment property that is in my name
3) During closing her name gets added to the title - (How does this happen?)

Grandma's house · #5 02-02-2008, 08:07 AM

You too can remain on title and add your wife AT close by deed. The entire loan gets underwritten as if she is the qualifying person. You don't have to get OFF title.
Keep in mind though. In a community property state, your debt and your credit report will have to get pulled and she MUST qual. on her income alone for ALL debt. including yours.

Also...if you added her PRIOR to close...and removed yourself PRIOR to close...the existing lender could call your loan due for altering the terms of the existing loan. ESPECIALLY if you quit claimed yourself OFF and what IF she does not qual. and the loan doesn't close, drops dead etc...? What a mess you would be in now wouldn't you?

This is why I recommend NOT doing these things until you get to the CLOSING table paying off the existing lender. :-)

kurisingal · #6 02-02-2008, 08:10 AM

awesome... thx so much for your responses... I really appreciate it!

Grandma's house · #7 02-02-2008, 08:16 AM

I edited something...Did it ever occur to you when you had your wife quit claim on and yourself OFF what if your deal for what ever reason can't close? If your existing lender got wind of your changing the terms of your existing loan CONTRACT they could call it all due and payable.
So many people make this mistake. They think a mere filing fee to add or delete people is just that easy...and it IS. It is the consequences though.

Your rental property may not BE refinancible in today's market.

kurisingal · #8 02-02-2008, 08:20 AM

Wow! I never thought of that... Luckily we haven't done this yet... thx so much again for this invaluable advice

FlyingRon · #9 02-04-2008, 11:53 AM

Quote:

Originally Posted by Grandma's house

If your existing lender got wind of your changing the terms of your existing loan CONTRACT they could call it all due and payable.

Removal of spouses based on divorce CAN NOT be used to trigger a due-on-sale. Likewise with adding spouses.

The other points about not giving up ownership when you still have debt responsbility hold.

Grandma's house · #10 02-04-2008, 07:57 PM

If the spouse that is IN title for the loan (the only one on that loan) quit claims himself OFF and puts someone else on...ihe/she is in default of the note. Other wise we would have no need for "assumptions" i.e. F.H.A. or the need to sell..heck, we could just take the 20% down and pocket the cash and quit claim the new buyer on the title and quitclaim ourselves off. I understand that you are saying in the event of a divorce. However this is still altering the terms of the loan and should get approval of the lender to do so. I don't think it will go over well at all.

FlyingRon · #11 02-05-2008, 09:14 AM

I doubt seriously that irregardless of the title, the bank would consider a note without taking both spouses into the equation. That's just the way life is.

Garn-St. Germain precludes them from calling a note because of adding a spouse to the title.

As for quit claiming off, that's another story some how in the replies to the thread I lost that there is NOT A DIVORCE involved here. Quit claiming property other than through a divorce CAN INDEED cause a due-on-sale.