Posted on: 18th Sep, 2009 09:07 am
When I got married a few years ago, my ex and i did a refi and put me on the house loan and title. We have since divorced and he was unable to refi again to get my name off the loan/title. He is now trying to short sale the house. What are all the implications on me- credit score, tax, and most important- my own house. I have not lived or paid on his house for over 3 years, and he is not listed on my new house.
you will apparently be harmed by the impending short sale to the extent that it affects the payment of the mortgage on that home (if late). a short sale is definitely worlds better than the foreclosure or deed in lieu of foreclosure alternatives.
distancing yourself isn't really an option; what you'll have to do is to document everything that has taken place if you seek new credit in the future. this will show up on credit - to precisely what effect, i cannot say, but it'll be there.
as for your home, i can't see any harm. you would be prudent to discuss this with a real estate attorney, of course, so as to be better assured. i'm also curious, as this would be beneficial, if your divorce decree stipulated the need for him to refinance. even though he could not, that would help you in defense of whatever might become derogatory on your credit report.
distancing yourself isn't really an option; what you'll have to do is to document everything that has taken place if you seek new credit in the future. this will show up on credit - to precisely what effect, i cannot say, but it'll be there.
as for your home, i can't see any harm. you would be prudent to discuss this with a real estate attorney, of course, so as to be better assured. i'm also curious, as this would be beneficial, if your divorce decree stipulated the need for him to refinance. even though he could not, that would help you in defense of whatever might become derogatory on your credit report.
Short sales allow a homeowner to close on the sale of property worth less than the debts secured by it. Typically, the lender agrees to accept the net proceeds from a closing in exchange for releasing its lien. Lenders are not agreeing to a short sale to be generous, they are convinced that it will come out better than it would by foreclosing on the home and pursuing the borrower for its losses. While the procedures for a short sale will vary from lender to lender, most lenders need to be convinced of the following:
The sales price of contract is equal to what they would be able to sell the property for after a foreclosure. While the lender may review the market analysis provided by the agent, they will often confirm the market analysis by contacting its own sources, such as an appraiser.
The commission for the transaction is equal to the commission it would pay its agent for selling the home after foreclosure. The lender will need to know as precisely as possible the amount of proceeds it can expect to receive from the sale.
The lender will want an explanation of the circumstances which caused short sale in the first place. These usually include death, medical problems, divorce, loss of a job, or a job displacement requiring a move.
The seller doesn't have the resources to make up the mortgage shortfall on their own. The lender will require a full assessment of the financial condition of the seller. Financial statements, income and expenses, tax returns and the seller's paycheck stubs should be provided. The seller's financial condition is a tricky proposition. While the lender will be reluctant to approve a compromise without reviewing strength of the seller, this information will help the lender in pursuing the seller for a post-foreclosure deficiency if the short sale does not take place.
A seller with few assets, little or no income, and a willingness to file bankruptcy has little to lose by providing this information. Those with other assets, a good job with garnishable wages, or a desire to avoid bankruptcy will put themselves at risk in the process. Those considering a short sale need expert legal advice regarding the wisdom of submitting financial information to the lender.
The sales price of contract is equal to what they would be able to sell the property for after a foreclosure. While the lender may review the market analysis provided by the agent, they will often confirm the market analysis by contacting its own sources, such as an appraiser.
The commission for the transaction is equal to the commission it would pay its agent for selling the home after foreclosure. The lender will need to know as precisely as possible the amount of proceeds it can expect to receive from the sale.
The lender will want an explanation of the circumstances which caused short sale in the first place. These usually include death, medical problems, divorce, loss of a job, or a job displacement requiring a move.
The seller doesn't have the resources to make up the mortgage shortfall on their own. The lender will require a full assessment of the financial condition of the seller. Financial statements, income and expenses, tax returns and the seller's paycheck stubs should be provided. The seller's financial condition is a tricky proposition. While the lender will be reluctant to approve a compromise without reviewing strength of the seller, this information will help the lender in pursuing the seller for a post-foreclosure deficiency if the short sale does not take place.
A seller with few assets, little or no income, and a willingness to file bankruptcy has little to lose by providing this information. Those with other assets, a good job with garnishable wages, or a desire to avoid bankruptcy will put themselves at risk in the process. Those considering a short sale need expert legal advice regarding the wisdom of submitting financial information to the lender.
i don't get that last paragraph at all