Home Loans and Support

Trouble to remove ex spouse from Mortgage

Discussion in 'Countrywide Home Loans - Tell Us Your Countrywide ' started by Sactor, Jan 29, 2009.

  1. Sactor

    Sactor LoanSafe Member

    Hi Folks... I am appreciating all of the dicussion and information:

    My situation is a bit different but frsutrating none the less. My Wife and I are close to completing all the paperwork for our divorce judgement. We currently own two homes, I live in one, she in the other however we are both on the title and mortgage both houses.

    I have contacted CW to try to get them to take my souses name of my mortgage, and vice versa, only to be told :

    1) you need to refinance to do that... but you cannot refinince since your mortgage is upside dwon to the tune of $60K (unless you can come up with 60K to pay off the difference.... OR

    2) we can process an assumption - which will remove the other person 's name from the loan (but when i question them they admit that this will not remove the morgage liability and hence the morgage stays on each others credit record and issues oafterward by one can affect the other.
    I understand this is called Simple Assumption which really does nothing for me except allow me to pay them a fee.

    I have read about Novation which would have the mortgage assumed by one and the other person's name removed and all liability released.

    The deal is I can afford my mortgage, and my credit score is sufficient to manage the mortgage on my own credit - so I do not want a modification, or refinance I just want to be the only one liable for my mortgage and my son to be ex responsible for her mortgage.

    Has anyone heard of or managed to convince CW to remove one person from the mortgage and release liability?

    Any suggestions?

    My ex is looking at trying to get a short sale, and accept the 2 yr credit impact, but of course that will affect my credit... and of course if something happens to me a while later I would create similar havor on her rating.... Seems that I might be best off to do the same if my credit will get whacked anyways..

    Ideas?

    Thanks
  2. Sactor

    Sactor LoanSafe Member

    Update:

    I called the executive line (only to be told for the 3rd time in 3 days to call back since their systems were down) but I convinced the person to patch me through to someone else. I got "PAT" who, when I indicated that all I wanted was to remove my spouse from the loan due to a divorce INCLUDING liability (i.e. not just name) she said this can be done, without other modification.

    She advised that this was in fact possible and told me I would need to:

    write a letter to the Correspondence Department indicating the Loan number, the last 4 digits of my social and then provide the following:

    1) Copy of the Divorce Decree (judgment)
    2) Copy of the deed recorded indicating the ex spouse's name removed

    3) Copy of the Home ownership insurance showing that the ex spouse's name was also removed
    and then send the letter, items request to 1- 800 - 805 - 5019 Correspondence Department


    She confirmed that this would release the liability as well as removing the name (ie not a simple assumption)


    So this sounds like good news but I have a bit of a worry that to do this the transfer through either a quit deed or inter spousal transfer deed would need to be recorded meaning that each of us would no longer have ownership of the other home but potentially still end up with Liability for the mortgage if this somehow does not work.

    Comments gladly welcomed :)
  3. MP927

    MP927 LoanSafe Member

    It sounds like it will be easily worked out for you then *thumbs up*. Maybe Cat can give you some more feedback when she's available :)
  4. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    That is really good and easy enough...............I was always told what you were originally told and that is that you would need to refinance to get them off................so this is a refresing change that will help others.................
    Thanks for posting it.:)
  5. Sactor

    Sactor LoanSafe Member

    Thanks Folks... I am still a bit uncomfortable about signing away my name on the deed without having proof that this will work or that the liability will truly be eliminated... I am thinking that I need to try to ask a couple of times and see if I can get that story from more than one person... Or send a letter to the Exec Team and ask for a written response confirming that a written release of liability will be given

    Cheers
  6. toola

    toola LoanSafe Member

    Hey Sactor that doesnt sound right! you have to refi her off the note! they just dont let her out of her obligation, i'm going thru same thing only we got one house we are upside down owe more than its worth, so i cant refi. i can do quick claim but still doens't take her off note. I cant afford note the way it is now, so i'm trying to get CW to reduce principle then i know i can afford it. Maybe someone has more info to help us!
  7. Sactor

    Sactor LoanSafe Member

    <o:smarttagtype namespaceuri="urn:schemas-microsoft-com<img src=" http:="" www.loansafe.org="" images="" smilies="" redface.gif="" border="0" alt="" title="Embarrassment" smilieid="2" class="inlineimg"></o:smarttagtype>Certainly a simple assumption and deed transfer will not affect the Liability - but there is a Novation assumption that may satisfy the bill. I am guessing that the investor needs to agree, That I need to satisfy them re my credit rating on my own etc. But worth a second opinion so I decided to do a bit of a confirmation check since it is easy to have be told something on the phone, but maybe different when I ask in writing. So I sent this letter: to the Correspondence Dept 10805-520-5019<link rel="File-List" href="file:///C:%5CDOCUME%7E1%5Csafvaro1%5CLOCALS%7E1%5CTemp%5Cmsohtml1%5C01%5Cclip_filelist.xml"><!--[if gte mso 9]><xml> <w:WordDocument> <w:View>Normal</w:View> <w:Zoom>0</w:Zoom> <w:punctuationKerning/> <w:ValidateAgainstSchemas/> <w:SaveIfXMLInvalid>false</w:SaveIfXMLInvalid> <w:IgnoreMixedContent>false</w:IgnoreMixedContent> <w:AlwaysShowPlaceholderText>false</w:AlwaysShowPlaceholderText> <w:Compatibility> <w:BreakWrappedTables/> <w:SnapToGridInCell/> <w:WrapTextWithPunct/> <w:UseAsianBreakRules/> <w:DontGrowAutofit/> </w:Compatibility> <w:BrowserLevel>MicrosoftInternetExplorer4</w:BrowserLevel> </w:WordDocument> </xml><![endif]--><!--[if gte mso 9]><xml> <w:LatentStyles DefLockedState="false" LatentStyleCount="156"> </w:LatentStyles> </xml><![endif]--><style> <!-- /* Style Definitions */ p.MsoNormal, li.MsoNormal, div.MsoNormal {mso-style-parent:""; margin:0cm; margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:11.0pt; font-family:Arial; mso-fareast-font-family:"Times New Roman"; mso-bidi-font-family:"Times New Roman";} @page Section1 {size:612.0pt 792.0pt; margin:72.0pt 90.0pt 72.0pt 90.0pt; mso-header-margin:36.0pt; mso-footer-margin:36.0pt; mso-paper-source:0;} div.Section1 {page:Section1;} --> </style><!--[if gte mso 10]> <style> /* Style Definitions */ table.MsoNormalTable {mso-style-name:"Table Normal"; mso-tstyle-rowband-size:0; mso-tstyle-colband-size:0; mso-style-noshow:yes; mso-style-parent:""; mso-padding-alt:0cm 5.4pt 0cm 5.4pt; mso-para-margin:0cm; mso-para-margin-bottom:.0001pt; mso-pagination:widow-orphan; font-size:10.0pt; font-family:"Times New Roman"; mso-ansi-language:#0400; mso-fareast-language:#0400; mso-bidi-language:#0400;} </style> <![endif]-->


    ~~~~~~~~~~~~~~~~~

    Subject: Removal of Ex Spouses name from Mortgage AND Release of Liability for removed person<o></o>
    <o></o>
    Dear Countrywide:
    [FONT=&quot]This is a “qualified written request†under Section 6 of the Real Estate Settlement Procedures Act (RESPA).<o></o>[/FONT]
    <o></o>
    I am currently in the final stages of a divorce. I currently jointly own a home at <st1:address w:st="on"><st1:street w:st="on">XXXXXX</st1:street></st1:address> which I occupy exclusively. My soon-to-be-ex spouse owns another home jointly with me which she occupies exclusively. As part of the Divorce we are planning to transfer the deed to the other party for the house they occupy and need to achieve the same transfer for the Loans. Normally this would be done by refinancing the mortgages in the occupants name only, however due to the drop in home values the loan is upside down and I currently owe ~ $269K while the value of the home is about ~$215K so Countrywide will not do a refinance.
    <o></o>
    I would like to know what I would need to do to get my ex spouses name removed from the loan AND a release of liability for her so that she is not liable anymore for the loan on my house. Similarly I will be working to achieve the same goal on her loan to remove myself including release of liability.
    <o></o>
    After a large number of phone calls to your various Customer service departments I spoke with someone from the Executive Team “Pat†who advised that this was possible if I send in copies of:
    1) the divorce Decree/ judgment
    2) Deed record showing my ex spouse removed from the deed
    3) Evidence that my ex has been removed from the home owner’s insurance policy
    <o></o>
    Can you please confirm, in writing, the above, or advise corrections, and confirm that this can be done and that only I would be left liable for the mortgage.
    <o></o>
    Please note that it is my intention to keep the loan as is as far as term, payment, rate, and continue my excellent record of payment against it, and believe that I qualify for the loan on my own credit. All I need is to ensure that my ex is removed from the loan and released of liability…so I am hoping that Countrywide will see this as a win-win and advise.
    <o></o>
    I am a member of the Loansafe.org forum and would love to bring back a positive story of my negotiations with Countrywide. I understand from RESPA that you are required to acknowledge my request within 20 business days and resolve it within 60 business days and so I am hoping to that this will be fairly easy to confirm and I look forward to your Reply
    <o></o>
    I can be contacted as follows: XXXXX<st1:address w:st="on"><st1:city w:st="on"></st1:city><st1:state w:st="on"></st1:state><st1>


    </st1></st1:address>
    Sincerely


    ~~~~~~~~~~~~~~~~~~~~~~~~~



    I will advise what I hear :)
  8. shanpain

    shanpain LoanSafe Member

    What happened with this? I am in a very similar situation.
  9. TheOwner

    TheOwner LoanSafe Member

    What was the final outcome with this situation? I'm in the same boat....
  10. Moe

    Moe Call 1-800-779-4547 Staff Member Loan Safe Mortgage

    I have never seen this happen outside of a refinance or death. So, I assume it didn't happen.
  11. Do_the_math

    Do_the_math LoanSafe Mortgage Guide

    As long as the remaining borrower was able to qualify for the loan, should not be impossible to complete a formal assumption and obtain a release of liability for the other party. If the wife intends to complete a short sale, I don't believe that she will be able to get the spouse deleted from the loan.

    This is one of the hazards of joint credit. The divorce decree does not override the contract, and the creditor is not required to cooperate. The good news is that as far as FHA mortgage underwriting goes, the post divorce credit and/or short sale will not be held against the remaining borrower due to the divorce settlement.

    Aside from that, a refinance with a short payoff might be the best plan. I'd be more concerned about the short sale on the other property. If it were me, I'd want evidence of release of 100% liability to execute a quit claim deed (unless ordered by the court). After the short sale, at least attempt to get it removed from the credit by mailing the applicable portion of the divorce decree to the credit bureaus.

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