Mortgage

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Hi there,
Five years ago I co-signed with my father on a mortgage, and now I need to get out of that mortgage, so my fiance and I can get a house together. My father will not refiance(because he has 5.5 interest rate) or sell the house, we are complete enemies because of some things he has done to me, and we do not talk to each other. How do I get my name off of this mortgage, so I can get another mortgage with my soon to be wife Smile

?????

Sincerely,
Shbrody.

michelle · Posted: Sat Jan 05, 2008 7:00 am Post subject:

Welcome to the forum shbrody,

First, congratulations on your engagement. I am sorry to hear that your relationship with you father has become so strained.

Your father may be able to get you released from the current mortgage through novation. In order to do that, he would need to contact his current lender. Basically, it would not require him to refinance or sell, it would just remove you from the existing mortgage and make it his sole responsibility. It's possible that you could make the call to the lender and ask that they consider this option as well. That might be your best option - make the call yourself.

It is also possible that you could still get a new mortgage while remaining on this one with your father. The lender on your new home might look at the fact that your father is making the payments on the other loan and exclude that payment from your debt to income ratio. But - that would not release you from liability on the first loan so if your father should stop making payments you could still be "on the hook" for that joint mortgage.

Best of luck. Let us know if you have any other questions we can answer.

larry · Joined: 27 Jun 2007 Posts: 3251 461.39 Dollars($)

Hi Shbrody,

Welcome to the forum,

Michelle has given you sound suggestions. I agree with her that If your father don't want to refinance, novation is the other way to release you from the mortgage. But the fact is your father and the lender are the person who can only release from the mortgage. So you have to negotiate with your father Smile

If you become enemy, he may not agree even for novation. So first of all you should try to negotiate with your father and make him agree for the novation.

Feel free to ask if you any further questions

Best of luck,
Larry

ezmortgageloanz · Posted: Sat Jan 05, 2008 8:02 pm Post subject:

Although novation is possible, I wouldn't be quick to assume that you would qualify for another mortgage while maintaining your current position with your father (it all depends on how your DTI [debt to income] is impacted).

If bad blood exists between the two of you, this is even more reason to get yourself out of the mortgage obligation---any wrongdoings on your father's part (read missed or late payments) will have an adverse impact on your credit history and potentially your ability to qualify for your own mortgage with your fiance...

The one thing not mentioned about the novation process that should be mentioned---the lender will only consider it if your father is able to qualify for debt service on his own (which I assume might be an issue, otherwise why would you co-sign with him in the first place)...

Good luck.

Regards,

Scott Miller

lisascherzer · Joined: 04 Jan 2008 Posts: 599 69.58 Dollars($)

Hi shbrody,

Would your father be willing to refinance if he could get a 5.50% or better rate? This might be possible right now since rates have come down. If he is just going to be stuborn, then you could go with a no income verification loan if your credit score is good. That way you won't have to worry about that obligation getting in the way of qualifying for your new mortgage.

gmakerley · Posted: Mon Jan 14, 2008 11:56 am Post subject:

i think michelle's outlook on this situation is right-on.

you have to be as conciliatory as possible with your dad to ensure that he will cooperate in providing the other bank with the documentation to show he has been making payments.

no income verification loans do exist, but they are priced higher than conventional loans, so you truly will wish to get a conventional if at all possible.

scott mentions late payments, etc. on your dad's part. since you never mentioned that as an occurrence, i gather that he has been paying with no issues. i would suspect he is still desirous of keeping the home and making payments so as to maintain good credit as well.

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