quit claim deed - nasty divorce

stevij2000 · Joined: 14 Jul 2008 Posts: 2 2.38 Dollars($)

My wife and I are currently going through an unfriendly divorce. I am paying one half of the mortgage and utilities for our marital property where she lives (the property is in both of our names,) and I am paying for rent and utilities for my apartment. Hence, I'm broke and lawyers are expensive.
She wants to purchase the house alone, and she says that she has been approved for a loan. However, she says that in order for her to be able to obtain a mortgage to purchase the house, I would have to sign a quitclaim deed.
I understand that by signing a quitclaim deed as a grantor, I give up all interest in the property, but I am still liable for the current mortgage. I believe that she would gladly go on living in the property and claim 100% interest while I would be forced to pay half of the mortgage.
Are provisions legally binding in a quitclaim deed? ie: "grantee must obtain a mortgage .... within a reasonable amount of time..."
Or, how would you handle this situation?
Thank you Kindly,
Stephen

Niicss · Joined: 03 Oct 2005 Posts: 1047 156.17 Dollars($)

Welcome Stephen.

You should talk with the mortgage company regarding this. If she wants to buy the property, this can be done smoothly without having any problem. With your ex-wife, the mortgage company and your agreement she can refinance the mortgage on her name only and you can quitclaim the property to her at the same time. So talk with the company. I think this is the best way to go. But I feel an attorney's presence and guidance is needed to make the process error free.

Let me know if you have any further queries.

kpatrick · Posted: Tue Jul 15, 2008 6:16 am Post subject:

Hi Stephen,

Has the court ordered you to pay half of the mtg? If so, even if she refinances the home into her name, you will be released from liability with the mortgage co, but not with the court.

If there is equity in the home that you are expecting to ask for through the divorce, then I wouldn't sign it over until that has been resolved.

However, if there is no equity that you are asking for, then, in my opinion, it would be a good idea to get your name off the property, so that if she gets behind in the payments, it will not affect your credit.

But, like Niicss said, it is never bad to consult an atty to make sure your interests are protected.

Good luck!

Kim

jheard · Posted: Tue Jul 15, 2008 8:37 am Post subject:

Ask your divorce lawyer.

A deed is not a contract, so provisions in the deed are not necessarily binding. You will need a written contract. The contract should state that this is a settlement on your divorce judgment along with the sale provisions.

Do not give a deed without payment. You will be giving up any security interest you have in the property. Give her the deed when she gives you the cash, or do it as part of an escrow or closing.

0.10 Dollars($)

Ditto on all the caveats above but one point of concern. I wouldn’t be too quick on making her refinance. If the existing interest rate is beneficial, you may wish to check with the lender to see if you can be formally dropped from liability. Of course, it’s a nasty divorce and you’d be helping her but going the “extra mile” might help in other negotiations.

Just did one for a ex-husband where they had two jointly help properties and ex-wife was holding him hostage until she got “her equity”. One property was F&C and made a loan on it (his name only) to obtain needed cash for her; then got her released on the primary residence. A MI company was involved on the primary so it took longer (3 weeks) than I had anticipated but he kept his 5.75% rate on the primary and full title to both houses.

Watch out for any potential sleeper issues with state law but the attorney can walk you through this.

stevij2000 · Joined: 14 Jul 2008 Posts: 2 2.38 Dollars($)

Thanks for the response.
We experienced the mediation agreement and the marriage property orders die with the sale of the home - hhhhhmmmm.
The mortgage company is the only entity that could kill me, so that is the entity that I'm interested in - she's not a millionaire.
I'm just afraid because her financing company (which I discovered today is a new finance company) insists that I sign the quitclaim before closing her new financing package.

Do you or anyone else who may see this, experienced or have known how long a finance company can "drag-out" the mortgage payments once I sign quitclaim, and/or we sign an agreement?

Has the court ordered you to pay half of the mtg? If so, even if she refinances the home into her name, you will be released from liability with the mortgage co, but not with the court.

If there is equity in the home that you are expecting to ask for through the divorce, then I wouldn't sign it over until that has been resolved.

However, if there is no equity that you are asking for, then, in my opinion, it would be a good idea to get your name off the property, so that if she gets behind in the payments, it will not affect your credit.

But, like Niicss said, it is never bad to consult an atty to make sure your interests are protected.

Good luck!
Stephen

Niicss · Joined: 03 Oct 2005 Posts: 1047 156.17 Dollars($)

Hello Stephen.

I should say that you need not to sign the quitclaim deed if your wife doesn't refinance the mortgage? If she can refinance or pay your share of home equity then you should not have any problem to sign the deed.

Let me know if you have any further queries.

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