Is it possible to refinance with this situation?
by Mortgage Rates on Saturday, November 20th, 2010 | 4 Comments
-
Mortgage Info
-
Updates
-
Useful Links
-
-
Tags
2010 About article Auctions bank banks best Business buyers change Credit Debt Equity Financial First fixed Foreclosure From good Government Help Home house Housing interest Loan Loans Market more Mortgage Mortgages Need News options qualify Rate Rates refi refinance Refinancing should this Time variable would-
Meta
Of course he can refinance. He’ll just have to pay the difference between the old loan amount and the current market value. A refinance really just trades one loan for another. In this case, an even trade just isn’t possible because no bank will give a loan that far above market value.
The husband should apply to the mortgage company to have the wife’s name removed from the mortgage. There is usually a fee but it shouldn’t be over $1000 and perhaps less.
This way none of the terms of the mortgage will change but the wife is free of the responsibility.
She is going to have to push the issue, the only way to refinance property that has negative equity is to pay the difference, lucky it sounds like he has other assets to pay the difference; But she has to push the issue, the court decree is only binding on the husband the courts can not force the lender to refinance the property,
If he has the means to make up the difference then he should be made to refinance no matter what the cost, the longer she stay’s on a note that she had no interest in, the increase danger
If the husband have ARM rate, he can try and refinance the house with new FHA program which allowed people who’s value of the property drop to switch from ARM to fixed rate. Did you try to talk with your current lender and ask them to refinance ?