(Closed) Foreclosure

posted 6 years ago in Home
Post # 3
Member
2622 posts
Sugar bee
  • Wedding: November 1999

No idea, but dont forget you would also be responsible for all the back payments since 2010, not just the payments going forward.

Post # 4
Member
2214 posts
Buzzing bee

I’m surprised that it wasn’t ordered that she refinance the home in her own name. Anyways, you would need the bank to agree to a loan modification, which I hear take a long time to approve.  And the bank could require that you are current on the payments before they do a loan modification.  From what I see, banks handle everyone’s situations differently so it’s hard to predict.  Lastly, I could see there being a problem with you guys moving into the home since there are court orders that the ex stays there.

Post # 5
Member
10367 posts
Sugar Beekeeper
  • Wedding: September 2010

Not only are you responsible for back payments, there are WAY more expenses with a house than with a rental. Just because the mortgage *might* be lowered to your current rent doesn’t mean that insurance, tax, and maintenance are included in that #.

Post # 6
Member
249 posts
Helper bee
  • Wedding: May 2013

I would think of these as two separate issues. First resolve the issue of the pending lawsuit/what they’re claiming he owes and then try to strike a deal to take over on the house.

(Maybe I’m wrong, I’m no expert…)

Post # 8
Member
249 posts
Helper bee
  • Wedding: May 2013

If you have the documentation you say, I wouldn’t see how the suit could get that far.. I don’t think they can automatically take your money from savings/checking but they could say you owe X amount pay now or xyz will happen (payment plans, wage garnishments, etc.).

Post # 9
Member
772 posts
Busy bee
  • Wedding: December 2011

I think you need to go back to your lawyer who handled the divorce.  The terms of the settlement change if she didn’t make payments and the house is foreclosing.  Does he pay her alimony or any other support?  

Sorry, but I think you guys need more help than an internet chat board can provide.  Maybe look for housing assistance in your area, just be careful of scammers? 

Post # 12
Member
246 posts
Helper bee
  • Wedding: September 2012

This happened to me too, only it was with my ex-husband.  He agreed that if he was unable to make a payment for any reason, he would tell me so I could try to help since the house was in my name also.  He stopped making payments, and I didn’t find out until I applied for an auto loan.  Imagine how humiliating…  I was able to pull my house out of foreclosure with the help of the Home Affordable Modification Program (makinghomeaffordable .gov).  They can lower your interest rate, thus lowering your payment to make it affordable.  I hear not a lot of people qualify, but luckily I did.  I regained the property a couple of years ago and have been making regular payments ever since.  The house is STILL also in his name though.  I now owe more than it’s worth because he skipped payments for so long (interest, etc.), so I can’t refinance it.  Until the market picks up or I have paid enough down, I can’t refinance OR sell it. 

It’s definitely worth a try.  I wish you luck.  It’s certainly not fun to go through. 

Post # 13
Member
1330 posts
Bumble bee
  • Wedding: July 2011

i didn’t go thru the exact same thing but i do have a house with an ex which is in foreclosure…if you’re looking for a forum with people going thru similar experiences, try bkforum.com…..its not just about bankruptcy and i am in no way suggesting bankruptcy, but there are boards on there about foreclosure, and maybe some ppl there can share their experiences with you.

but like @justelope: mentioned, you’ll need more advice and help than you can get from any forum. and i would write a list of questions for your lawyer and be weary, the first lawyer i went to for a consultation wouldn’t answer my questions completely and kept trying to just gain my business instead….you’ve got to feel comfortable that they are there to help you and not just collect a paycheck (no offense to any lawyers out there)…

Post # 14
Member
73 posts
Worker bee

My first piece of advice is – TAKE A BREATH!!!!!  I am not sure what state you reside in and the foreclosure process varies by jurisdiction – but the good news is that you must live in a state which requires judicial foreclosure as opposed to a deed of trust state where the court is not involved and the loan papers contain a “power of sale” clause which grants the lender the right to sell the property to the highest bidder literally on the court house steps.  A judicial foreclosure state requires a court action where the lender has to receive a judgment in order to sell the house.  So,  while it is a stressful process, you have time to figure out what you can do.  His answer is due in 20 days – this does not mean that you have to have everything figured out within that time period.  This is just the time period under the rules of civil procedure  for an answer to be filed.  After an answer is filed, a hearing will be set.  If you live in a busy jurisdiction, the date will be down the road a bit. 

 

Okay, now that I have you breathing again 🙂 – let’s move on. . . . . . .

 

My first question was already raised by someone else:  Who was your hussband’s attorney dudring the divorce????  While I am not a domestic law attorney, I have gone through a divorce myself.  When I drafted the petition, I added language where I would refinance the house within 2 years and my ex signed a quit claim deed at the time of the divorce.  The reason we made the period 2 years was so I could wait and get a good interest rate instead of being rushed.  This is a typical requirement when a house is transferred from one spouse to another.  Your husband’s attorney should have required the refi as part of the settlement.  I would expect also that there would be indefmnification provisions for any costs/expenses that your husband would suffer caused by his ex-wife’s failure to make payments and refinance the house.  Does the decree have such a provision???? If it does not, I think that your husband would have a malpractice claim. 

 

Next, I disagree with the post where someone said to handle each point seperately.  If I was your attorney (and I am NOT and this is NOT legal advice creating such a relationship), I would definitely address the issues together.  First, you do not want to be paying money to the bank and not have come to an agreement on who owns the house.  They have to be handle simultaneously. 

 

With respect to your options at this point, banks do NOT want to foreclose on the house if at all possible.  There are way too many of these happening and they would much rather work out a solution.  Someone already pointed out that you will not be able to just simply take over the payments and go forward.  However, you can work out an arrangement whereby the past due amounts are rolled back into the mortgage.  Depending upon your credit with your husband, the bank will have a few options to allow you to choose.  I would start with asking to have all of it rolled back into the loan.  If they won’t do that, then maybe a combination of paying some of the past due amounts and having some rolled back into the balance.  There are government refi programs but from what I have heard, the approval rate is very low and the time it takes for you to get an answer will cut into the time you have left to find a solution. 

I have to assume that the house was deeded over to her when they divorced.  Has the ex agreed to you two taking over the house?  Obviously, you will need to have that agreed to prior to doing anything.  Do NOT take over payments and move into the house without having her sign a deed over to you.  Otherwise, you will just be renting the property from her. 

Once a judgment is obtained for the balance of the mortgage, the bank will sell the property to the highest bidder (again, literally at the court house).  The highest bidder is usually the bank (unless there is quite a bit of equity in the house).  The reason is that for any other bidder to buy the house, it has to be where the loan balance is low enough to make him/her comfortable that they are getting a great deal – because the buyer will not have seen the inside of the house or be able to have inspections done prior to purchasing (unlike in a regular sale of a home).  The buyer is taking the property “as -is” and has no idea if the inside of the house is a complete mess or if there are multiple mechanical/structural issues.  Once the sale occurs, there will be a redemption period and this varies by state.  Could be 12 months… .could be 3 months. 

 

With respect to your question about garnishing your wages, that will only happen if there is a deficiency judgment.  If there is little to no equity, most likely the bank will not be “made whole” by buying the house and re-selling it.  If that is the case, and if your state allows it, the bank could come after the owners for whatever that shortfall is.  That is where the garnishment comes into play.  I don’t think that it actually happens a lot but I’m sure it does sometimes.  And I would assume that the loan documents do not require the lender to split that difference and go after both your husband and his ex to recover it.  Most likely the docs provide for joint and several liability which means that the lender can go after whichever party appears to have more money!

 

Other possibilities are a deed-in-lieu or a short sale.  A deed in lieu is where the borrower deeds the property back to the lender and that ends all obligations.  A short sale is where the lender allows the owner time to attempt to sell the house, even at a loss. 

 

Sorry for the long response – tried to keep is short and simple.  If I was you, I would contact the lender immediately and discuss what opions are available.  I would do this prior to meeting with an attorney.  If the lender is willing to work with you all, you may not need an attorney and can use that money towards the past due balance. In any event, your meeting with the attorney will be much more productive if you can tell him/her what your lender is willing/not willing to do. 

Hope this helps a little.  Remember, I cannot give you legal advice because you are not my client and most likely live in a jurisdiction where I am not licensed. 

 

Sorry for any spelling/grammar errors – I am doing this on my phone!

 

Post # 15
Member
73 posts
Worker bee

Okay – I am an “idiot”!!  I just saw that your info says “Florida” on it – I didn’t see that until I wrote my answer. 

 

I am NOT licensed in Florida but my post is generally how the process works in a mortgage state with judicial foreclosure. 

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