Upside down in house

[bill44u]

What is the name of your state (only U.S. law)? FL

We are upside down in the house, owe $158K, value $100K. I will make payments for one year and wife will stay in house. At that time she will have the option of making the payments or we will do a short sale. I make $100K, she makes $35K so the bank will probably try (and succeed) in getting a deficiency judgement since I have the ability to pay. What I'm trying to come up with is the best way to handle the property settlement in the divorce papers?

One of the goals is to reduce or eliminate the deficiency judgement. I realize the mortgage lender is not bound by the divorce decree, but it appears that it might help in establishing a hardship.

Thanks for your help

 

[OHRoadwarrior]

With a combined income of $135k, you should both be able to work the issue out within a few years. What you are actually saying is you suck at buying houses and have been lucky to get a good job, now you want a way to not pay for your mistake. I suggest you sum up the division of marital assets, with you keeping the house or sum up the marital assets, with her keeping the house and you putting any of her equity toward payoff. Working solo, you could have the house paid off in 6 years easily.

 

[LdiJ]

What is the name of your state (only U.S. law)? FL

We are upside down in the house, owe $158K, value $100K. I will make payments for one year and wife will stay in house. At that time she will have the option of making the payments or we will do a short sale. I make $100K, she makes $35K so the bank will probably try (and succeed) in getting a deficiency judgement since I have the ability to pay. What I'm trying to come up with is the best way to handle the property settlement in the divorce papers?

One of the goals is to reduce or eliminate the deficiency judgement. I realize the mortgage lender is not bound by the divorce decree, but it appears that it might help in establishing a hardship.

Thanks for your help

I would really avoid the short sale route if you can. With your income you really want to protect your credit and a short sale isn't going to do that. Realistically can you see your wife ever being able to make payments on a 158k mortgage when she is only earning 35k? Do you have minor children? If so, will you be paying child support?

If I were in your shoes I would be tempted to go half and half with your wife right from the start on the mortgage payments, and give it more than a year...soley to protect my credit, not for any other reason. Otherwise, it would be better for YOU to remain in the home, since you can afford the payments.