contested divorce

[marlainorg]

What is the name of your state (only U.S. law)? Oregon...Can you please tell me what needs to be done in order to remove a name from a mortgage loan..My daughter wants out of the loan but her husband won't put the house up for sale because they will never get out of it what the loan balance is? He wants to lease or rent out the house and she just wants out..He won't buy her out and won't try to refinance in his name only. Since he won't let her out of the loan, what rights does she have if she does not want to put it up for rent and he does not want to put it up for sale? She suggested putting the house up for sale and she would pay half of the mortgage until the house sells but he still would not agree...She moved out over a month ago and said the house is very dirty..They have no children and she doesn't want any of the furniture and only family photo's and a her personal clothing, etc. They also have a car loan but they agreed she would keep the car and make the payments..His name is joint on this loan as well. Any advice you can give would be greatly appreciated..
Thank You

 

[mistoffolees]

The bank can not be ordered to remove her name.

Has someone filed for divorce? if so, then the proper procedure is to request in the divorce documents that he should keep the house, but be required to get the loan in his name only within 60 (or some number of days). In a few cases (if he has a good credit rating and there is sufficient equity), the bank may agree to simply remove her name for a small fee. In other cases, he will need to refinance. Have the order read that if he does not get her name off the mortgage within some time period, that the house will be sold. Make sure there is some protection so that she can ensure that the house is sold (such as preventing him from listing at a ridiculous price and then claiming no one wants to buy).

The personal property is hers. She can take her clothing at any time (as long as there's no protection order in place). If the photos are of HER family, she's OK taking them, as well. If they were of the two of them and their family, that might be more problematic, but since there are no kids, that's not likely to be an issue.

At the same time, she would request an order that he pay her 1/2 of the marital equity in the home. While there are exceptions, usually the person who keeps the home is responsible for the mortgage, particularly if he wants to rent it out.

 

[LdiJ]

The bank can not be ordered to remove her name.

Has someone filed for divorce? if so, then the proper procedure is to request in the divorce documents that he should keep the house, but be required to get the loan in his name only within 60 (or some number of days). In a few cases (if he has a good credit rating and there is sufficient equity), the bank may agree to simply remove her name for a small fee. In other cases, he will need to refinance. Have the order read that if he does not get her name off the mortgage within some time period, that the house will be sold. Make sure there is some protection so that she can ensure that the house is sold (such as preventing him from listing at a ridiculous price and then claiming no one wants to buy).

The personal property is hers. She can take her clothing at any time (as long as there's no protection order in place). If the photos are of HER family, she's OK taking them, as well. If they were of the two of them and their family, that might be more problematic, but since there are no kids, that's not likely to be an issue.

At the same time, she would request an order that he pay her 1/2 of the marital equity in the home. While there are exceptions, usually the person who keeps the home is responsible for the mortgage, particularly if he wants to rent it out.

I agree with this advice, except that OP stated in her initial post that the reason her son in law doesn't want to sell is because they cannot sell it for enough to pay off the loan.

That means that there is no equity, and it also means that he cannot refinance the home into his own name, unless he has a significant amount of ready cash to take to closing.

It also means that if it was sold now, it would be a short sale (again, unless there was money to take to closing) which would damage both of their credit scores.

His idea, to rent it out for a few years until it can be sold without a short sale, is actually a pretty practical one. Yes, it would tie up their credit for a couple of years, but there is a valid argument to be made that it could be preferible to the damage a short sale would do.

 

[marlainorg]

Thank You so much for the information...I agree that it would make more sense to rent the home opposed to selling it with the market being what it is here, but she just wants to be completely out with no ties to him...They could risk getting bad tenants and could result in the mortgage not being paid or the house being destroyed...Is there no other way to get her name off of the loan and if he wanted to rent the house out it would be only his responsibility?
Thank You.....I really do appreciate your help with this matter and the fact that you do take time from your busy schedules to answer questions for those of us in need...Thanks again...

 

[nextwife]

Thank You so much for the information...I agree that it would make more sense to rent the home opposed to selling it with the market being what it is here, but she just wants to be completely out with no ties to him...They could risk getting bad tenants and could result in the mortgage not being paid or the house being destroyed...Is there no other way to get her name off of the loan and if he wanted to rent the house out it would be only his responsibility?
Thank You.....I really do appreciate your help with this matter and the fact that you do take time from your busy schedules to answer questions for those of us in need...Thanks again...

Sure, she and he can sell now. Is daughter prepared to cover half the short amount?

 

[LdiJ]

Thank You so much for the information...I agree that it would make more sense to rent the home opposed to selling it with the market being what it is here, but she just wants to be completely out with no ties to him...They could risk getting bad tenants and could result in the mortgage not being paid or the house being destroyed...Is there no other way to get her name off of the loan and if he wanted to rent the house out it would be only his responsibility?
Thank You.....I really do appreciate your help with this matter and the fact that you do take time from your busy schedules to answer questions for those of us in need...Thanks again...

The lender is not going to let your daughter off the hook for a loan that is greater than the value of the home. It simply won't happen.

Her choices are short sale, which will do a number on her credit or taking a risk and holding on to the house for a couple of years.

 

[marlainorg]

Thank You...I really appreciate your information and help....

 

[TinkerBelleLuvr]

His idea, to rent it out for a few years until it can be sold without a short sale, is actually a pretty practical one. Yes, it would tie up their credit for a couple of years, but there is a valid argument to be made that it could be preferible to the damage a short sale would do.

There needs to be a mechanism in place so that BOTH parties can see that the mortgage/ insurance/ property taxes are being paid.