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assumption through a divorce

by crooke_745_162 from Columbus, Ohio. Oct 1st 2012 Reply


Derick Condron (rightstartoregon)
#32 ranked lender in Oregon - 598 contributions

Typically you can not have an assumption due to divorce. You will need to do a refinance to remove th spouse that is giving up their rights to the property.

Oct 1st 2012
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Bert Carpenter (BertCarpenter)
#37 ranked lender in Arizona - 1,823 contributions

There is too much missing information to properly guide you. If you are not on the loan now and you are not in a community property state, and if the loan does not have an assumption clause, you won't be able to assume the loan, even if you are getting a divorce. ~ Bert Carpenter, The LoansA2z team of NOVA Home Loans ~ NMLS 40586 ~ Licensed in California and Arizona ~ www.LoansA2z.com 888-889-9950

Oct 1st 2012
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Gary H (Mod.Specialist)
#71 ranked lender in New York - 25 contributions

Mortgages restrict assumptions of existing mortgage loans here in the U.S. Even when we do modifications - if two people are on the loan, need both party's to sign mod documents... Agree - you are either going to refinance or sell the property.

Oct 1st 2012
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Tim Bradford (Tim Bradford)
#6 ranked lender in Ohio - 145 contributions

I will take a shot here in giving you an answer. Only some loans allow you to remove someones name from the loan. FHA is one loan that does have a provision that allows you to assume sole responsibility for making payments on the loan. Step one is you want to contact the current servicing lender to determine if you loan allows assumption and what is required to complete the assumption. If you loan is assumable, you lender will want to document and verify that your income and credit justify the loan in the same way a lender would qualify you if you were purchasing the property. One benefit to completing a formal assumption is that you avoid some closing costs. Now depending on your rate of interest and the amount of your loan, a refinance is an option to consider. The obligation to make the payment is what an assumption deals with. Ownership of the property is another issue that should be looked at as well, that is where you need to make sure you talk with an Attorney and they advise and guide you. The ownership of the property and the obligation to make the payments are two very different things. You would not want to be the only once (Legally) obligated to make the payments and leave your ex with an ownership interest in the property. On the other side, your ex would not want to still be legally obligated to make the payments if for any reason you stopped making the payments and they had now ownership interests in the property. Talk with the Lender(Bank) and also an Attorney to determine the best course of action and make sure both are aware of your concerns or desire. I hope this assists you.

Oct 1st 2012
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