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Rickitickitavy · Joined: 19 Nov 2009 Posts: 1 1.44 Dollars($)

Help, I have a partnership with an excellent partner we own a duplex together owe 140K. He is getting a divorce and wants his name off the deed to keep it out of court so I will not be affected. The mortage company says they will not let me assume this mortagage and I have to refinance the property if I qualify. Now I know the property will not appraise for the 140K. Further they are going to want significant money up front, LTV 70% for investment I think, I do not have 35K lying around. Should I just let them foreclose and be done with it? will this affect my other properties that I own by my self?? not sure what to do.... I explained to the mortagage company if this goes to court then we all loose.

savior70 · Posted: Thu Nov 19, 2009 6:38 am Post subject:

Hi,

A foreclosure should be a last resort. If you let the investment property be foreclosed, both you and your partner's credit will be affected negatively. An assumption is also unlikely in this situation as the lender would not want to let a borrower off the hook, until the co-borrower refinances and pays off the mortgage debt. I think you should keep making the mortgage payments for the time being. As long as you keep making payments, the lender will not foreclose on the property. Once there builds enough equity in the property down the line, you can refinance in your name. But in case you do not want to keep the property, you can request your lender for a deed in lieu of foreclosure.

gmakerley · Posted: Thu Nov 19, 2009 10:36 am Post subject:

it's a sad commentary when the options mentioned are 1) refinance or 2) allow the lender to foreclose. savior, i like your response, but it seems to me that RTT wants to have it his way or no way - give me my refinance request, even though the value isn't there, or go ahead and foreclose on me.

have we really finally come to this?

Guest

well some good news I think let me know your thoughts.. I talked again with the mortgage company and there loan officers, the property is upside down big time here in WV, the partner I have is great you could never ask for a better partner, he did not want to drag me or this house into court, it is a rental property so I thought that was really cool of a partner,

The mortgage company will not allow me to take him off the deed unless I refinance, which I will need about 50K to do it and I am just not that rich. So looking at the divorce side we figure it is very unlikely that his wife will want part of a negative asset.. I don't think her lawyer would advise her to take on excessive debt split 3 ways.. So I am going to leave my partner as "silent" and continue business as usual..

George I appreciate your comments and believe me I do not want to be foreclosed upon at all... but until I had learned about the above written, there was really no option out there that the mortgage company would hear of, guess I got in a panic too quick but also felt backed into a corner by trying to execute what I thought was the right and respectable thing to do to satisfy all parties .. Even the mortgage apologized to me for their assumption policy and were in agreement with my intentions so don't be too harsh on me Smile

jveenstra · Posted: Thu Nov 19, 2009 3:34 pm Post subject: Negative Equity

I was about to write the same thing you wrote.

A property with negative equity can not be of much value to anyone in a divorce case or any other type of court case.

gmakerley · Posted: Thu Nov 19, 2009 9:14 pm Post subject:

this sounds like a reasonably good scenario now...final outcome to be determined i suppose, but i am also pleased to know that the mongoose is still alive! i hope that means something to someone. i guess i'm well-read.

anyway, RTT, good news at this point, and it's nice to hear your most recent analysis of things.

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Investment Property Assumption denied