My spouse let our home go into foreclosure after divorce.

[frankwidner]

I was divorced 9/2007. My ex was awarded our primary home in the decree with no language to refinance but language to maintain all dept and maintenance on the property. By 12/07 she had financed a second in her sole name for $114,000 which she used to purchase two other homes, one of which is also currently in foreclosure. 10/08 she quit making payments on the first mortgage which is in my name and the home went into foreclosure. I convinced her to quitclaim the property back to me so I could save my already damaged credit, which was spotless before. I want to sue her for the $6000 it cost me to bring it out of foreclosure. The $114,000 second on the property which I received no benefit from and she still receives income from. Since she stripped the home of many built in furnishings before she left I would like to sue her for the cost of the maintenance repairs that she did not keep up with as stated in the decree. I do not know if this is a family issue as a post divorce or a civil litigation matter. Thank You in advance, Frank Widner

 

[mistoffolees]

I was divorced 9/2007. My ex was awarded our primary home in the decree with no language to refinance but language to maintain all dept and maintenance on the property. By 12/07 she had financed a second in her sole name for $114,000 which she used to purchase two other homes, one of which is also currently in foreclosure. 10/08 she quit making payments on the first mortgage which is in my name and the home went into foreclosure. I convinced her to quitclaim the property back to me so I could save my already damaged credit, which was spotless before. I want to sue her for the $6000 it cost me to bring it out of foreclosure. The $114,000 second on the property which I received no benefit from and she still receives income from. Since she stripped the home of many built in furnishings before she left I would like to sue her for the cost of the maintenance repairs that she did not keep up with as stated in the decree. I do not know if this is a family issue as a post divorce or a civil litigation matter. Thank You in advance, Frank Widner

As I understand it, the second is in her name alone, so that doesn't affect you.

If she gave you a quit claim on the house, you've probably got about all you're going to get. You're only out $6 K and it will cost you a big chunk of that to collect from her. How much is the home worth and what is the total debt? I'd ask a realtor what you could get for selling it to see if you could come out ahead by selling it and paying off the debt.

 

[frankwidner]

The first is $130K and the second is $114K. The total owed is $244K. The home is worth about $220K which makes it upside down about $24K. She took out the second and bought two other homes with the money and then stuck me with the whole amount owed for the property. She also loaned some of the money to a friend which pays her back every month. She gets the loan payments and the rents from the home she purchased with the money from the second. Frank

 

[mistoffolees]

The first is $130K and the second is $114K. The total owed is $244K. The home is worth about $220K which makes it upside down about $24K. She took out the second and bought two other homes with the money and then stuck me with the whole amount owed for the property. She also loaned some of the money to a friend which pays her back every month. She gets the loan payments and the rents from the home she purchased with the money from the second. Frank

You are not responsible for the second mortgage since it is in her name. You have a quit claim, so the house is all yours. You can sell it for more than enough to pay off the first mortgage and then she'll be stuck for the rest. You'll be out the $6 K plus whatever you're paying in mortgage right now.

But you need to see an attorney. If she stops paying the second, it's her credit that will be harmed, not yours.

 

[Ozark_Sophist]

mistoffolees: Stop posting. The second mortgage does affect the OP because it is on his house. His ex could stop paying (or has) on the second and he could have his foreclosed.

A quit claim only means that the person who quits their claims has no legal interest in the property. It does nothing with the mortgage. In fact, if the bank (2nd mortgage) finds out about the quit claim, they will call in the whole note at once. OP and ex lose the house. OP couldn't sell the house unless he can pay off both mortgages.

OP may be able to challenge the second mortgage as he may still have been an owner of the house and did not sign refinancing documents. For that he would need to consult a local attorney who can review divorce and mortgage documents.

 

[Dougthegreat]

Ozark is right. The second mortgagee isn't just going to collectively shrug their shoulders and give up the secured property if it defaults simply because the wife quit-claimed.

OP needs to consult a lawyer to get this turned around QUICK, or he'll be out more than 6K.

 

[mistoffolees]

mistoffolees: Stop posting.

Gee. All this time, I thought this was a public board.

The second mortgage does affect the OP because it is on his house. His ex could stop paying (or has) on the second and he could have his foreclosed..

I already suggested that he see an attorney. Yes, the second mortgage company could foreclose, but he said he is bringing it up to date, so they won't do it now. He will obviously need to contact the mortgage company, but she has plenty of other assets. If he explains the situation to the second mortgage company, they may let HIM sell the house as long as they get everything after the first mortgage - and then go after her for the rest since her name is on it. Furthermore, since she took out money recently and the home is underwater already, there's a good chance that her other home is also security - which will make the second mortgage company better off.

He does need to see an attorney, but it's very likely that the resolution for him is going to be to sell the house, pay the first mortgage, give whatever's left to the second mortgage company and turn them loose on her for the rest. It's not to their advantage to keep him from selling the house and getting them as much cash as possible right now.

 

[Ohiogal]

Gee. All this time, I thought this was a public board.



I already suggested that he see an attorney. Yes, the second mortgage company could foreclose, but he said he is bringing it up to date, so they won't do it now. He will obviously need to contact the mortgage company, but she has plenty of other assets. If he explains the situation to the second mortgage company, they may let HIM sell the house as long as they get everything after the first mortgage - and then go after her for the rest since her name is on it. Furthermore, since she took out money recently and the home is underwater already, there's a good chance that her other home is also security - which will make the second mortgage company better off.

He does need to see an attorney, but it's very likely that the resolution for him is going to be to sell the house, pay the first mortgage, give whatever's left to the second mortgage company and turn them loose on her for the rest. It's not to their advantage to keep him from selling the house and getting them as much cash as possible right now.

Actually no the mortgage company will not let him sell the house because HE is not on the second mortgage. He woudl have to refinance the second mortgage into his name due to the fact that he is the sole owner of the house. Fraud has transpired here and the OP can be in hot water for his role in it.

 

[HomeGuru]

Gee. All this time, I thought this was a public board.



**A: and being that it is, we would appreciate correct and factual advice being posted.

 

[mistoffolees]

Actually no the mortgage company will not let him sell the house because HE is not on the second mortgage. He woudl have to refinance the second mortgage into his name due to the fact that he is the sole owner of the house. Fraud has transpired here and the OP can be in hot water for his role in it.

Actually, given the current state of the financial markets, he should talk with the second mortgage company. They very well might allow him to sell the house as long as all the proceeds go to the mortgage holders. They might be happy to get that much - and then go after her for the remainder. No, he can't FORCE them to, but they very well might prefer it to foreclosure.

That's where I would start - while talking with an attorney at the same time.

 

[LdiJ]

You are not responsible for the second mortgage since it is in her name. You have a quit claim, so the house is all yours. You can sell it for more than enough to pay off the first mortgage and then she'll be stuck for the rest. You'll be out the $6 K plus whatever you're paying in mortgage right now.

But you need to see an attorney. If she stops paying the second, it's her credit that will be harmed, not yours.

I have to disagree with that Misto....the second mortgage is still secured by the home, so even if he is not technically responsible for it, the house will still get foreclosed upon if its not paid...which will have a direct impact on HIS credit.

 

[mistoffolees]

I have to disagree with that Misto....the second mortgage is still secured by the home, so even if he is not technically responsible for it, the house will still get foreclosed upon if its not paid...which will have a direct impact on HIS credit.

Which is why I suggested that he call the creditor and work out a deal where he sells the house, they get whatever they can from the house sale and collect the rest from her.

The creditor would probably prefer a short sale to a foreclosure - and since they can still collect the balance from her (she has two more houses, so she clearly has some assets), it may not affect his credit much.

In any event, the ultimate resolution for him is going to involve selling the house-I'm sorry if my first post didn't make it clear that he'd have to work with the second mortgage holder to get them to take a short sale from the house and the remainder from her.

 

[frankwidner]

Thanks to all who have posted replies.

Update:
I still have possession of the home and have made all the payments on time for the first mortgage. I have never made one payment on the second as I do not feel it is my loan. The second is currently 90 days late as of the end of March 2009. Wells Fargo was sending letters but the last one I received said that my ex had called them and requested that they stop communicating with her. Since then I have received nothing. The last letter I got said that they would be sending it to their legal department.

I have a couple more questions. Since I owe 128K on the first and it is current and if the home was sold it would bring more than the 128K would my credit still get hit if even if the first was paid in full if the bank foreclosed on the second? I have been looking on the internet and it seems that in today’s foreclosure market that most of the time the holder of the first will not let the second foreclose if the first is still current. Banks holding seconds are going after the holders of those notes in the form of wage garnishments and other assets. Mine is slightly different in that Wells Fargo holds both notes.

One specific question for Ohiogal: I am confused how I as the OP have committed fraud. Can you explain this to me? If so I have unknowingly done so and do not want to be part of any illegal activity. I feel the second is not mine and only took the home back to save my credit from the foreclosure on the first which is the only loan in my name.

Thank You All

 

[Some Random Guy]

I am confused how I as the OP have committed fraud. Can you explain this to me? If so I have unknowingly done so and do not want to be part of any illegal activity. I feel the second is not mine and only took the home back to save my credit from the foreclosure on the first which is the only loan in my name.

Its fraud on the part of your ex if she got a mortgage on a house that you owned without your consent.

The second mortgage is not yours, but you will still lose the house over it if its not paid.

 

[penelope10]

Its fraud on the part of your ex if she got a mortgage on a house that you owned without your consent.

The second mortgage is not yours, but you will still lose the house over it if its not paid.

Agreed, however, the house was awarded to her originally in the decree so long as she kept up the debt and maintenance. No wording as to refinance. So at the time that she took out the loan (and how she got Wells Fargo to take out a second without the home being refinanced on the primary note is amazing to me with just a quit claim) if she was keeping up the mortgage etc. she was following the order....

Sounds like the whole problem arose from a poorly worded order. The ex should have been ordered to refi the home in her name only. Wells Fargo will still want the loan paid off irregardless of whose name is now on the deed.

OP needs to hire an attorney who specializes in Real Estate Law IMO ASAP since the second is now in default.