If I buy my ex husband out of my home do I have to refinance again?
If I buy my ex husband out of my home do I have to refinance again?
When I divorced, I reached an agreement with my ex-husband that I would continue to live in ourhome which was in both of our names for a period of 8 years at which point I either had to offer to let him buy it, buy it myself, or sell it at fair market value. A Quit Claim was completed at the time of the divorce. I pay for everything on the house while I live in it and at the end of the eight years my ex-husband gets his share of the equity. We still jointly have a HELOC secured by the house which we are both named on and we continue to split the cost of each month. I refinanced the house about 3 years ago and now the Deed is only in my name. Clearly my ex holds a mortgage in third place for his interest in the property.
What I want to know is this... In trying to figure out whether to sell the house or buy him out, I'm wondering...If we settle on an amount to pay my husband for his equity in the home, minus his half of what he owes on the HELOC, and then I pay the HELOC off in full myself (thereby ending that mortgage), do I have to go through the process of refinancing to have the mortgage my ex-husband holds dismissed, closed out, or whatever term you use? Or is he able to have it removed without my having to go through the refinance process again?
2 Answers
Votes
Older
Newer
1
What do you mean he holds a mortgage in third place? Are you saying he has a mortgage or that what you owe him is in effect a note that needs to be paid off
I need more clarity to answer your questions
How will you pay off his share - if you pay him - and then pay off the heloc it would just leave you with the first mortage that you refinanced - if that is the case you would not have to refi at that point
Brian Barnes
Mortgages in all 50 States
Brian@AimWithFocus.com - all emails answered -
1
What I mean is that the deed to the house is now in my name alone. So the Mortgage company is the first mortgage. The Heloc is in both of our names so that is the 2nd mortgage. And he has the third mortgage (or lein) that assures his claim to the agreed upon equity in the house that he has been waiting for. What I'm trying to decide is whether to buy him out or just sell the house and deal with the hassle of moving out etc. If I reach an agreement to buy him out and I pay off the HELOC, I know that the HELOC mortgage is closed by the bank, but how does his claim on the house get dismissed - thereby clearing me to just hold the original mortgage?
I want to know this because I am not in the financial position to be able to qualify to refinance again (which would establish my mortgage free of any other leins). How is his lein discharged (removed from record) Does he go to our lawyer and have something drawn up saying that he has been paid his claim on the house and have it filed with the court? Do I do something? Or would it not even be an issue when I go to sell the house down the road? Isn't there something official on record somewhere that would preclude me from selling the house after I've paid him off unless there is something official on record showing that I've paid him for his claim on the house?
To clarify what I mean by his "mortgage", my divorce agreement says: "In order to secure Husband's interest in the equity of the marital residence, Wife shall grant to Husband a morgage to secure his interest in said residence. Husband shall pay all costs incurred in preparing and filing the mortgage on the land records."