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Assuming a mortgage is the same as getting a completely new loan. As someone else stated, more than likely, your loan is not even assumable, but if it is, the only thing that is assumable are the terms. You would still have to completely qualify for those terms. Rates have come down considerably since your 4.75% so you wouldn't want to keep your terms.
But also, your ratios are too high. No one is coming out and saying it, but they are. Why does it matter if he remains on the loan? Your divorce decree will state who owns the property and who is responsible, so leaving it "as is" is the least expensive thing to do as it will cost you all your closing costs again to refinance it.
Assuming a mortgage is the same as getting a completely new loan.
I get that, but my understanding is that there is a huge difference in cost (it is much cheaper to assume a loan than do a full refinance, reason why I would like to look into it).
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But also, your ratios are too high. No one is coming out and saying it, but they are. Why does it matter if he remains on the loan?
It matters because if my ex wants to purchase a property in the near future (which is highly likely), it might become an issue (right?).
I get that, but my understanding is that there is a huge difference in cost (it is much cheaper to assume a loan than do a full refinance, reason why I would like to look into it).
It matters because if my ex wants to purchase a property in the near future (which is highly likely), it might become an issue (right?).
No, the costs of assuming a loan are not less. It still has to go through underwriting, processing, etc... same fees.
If he wants to buy a house, he will show his divorce decree and how he is not responsible for the mortgage. Millions of divorce people do it all the time.
No, the costs of assuming a loan are not less. It still has to go through underwriting, processing, etc... same fees.
If he wants to buy a house, he will show his divorce decree and how he is not responsible for the mortgage. Millions of divorce people do it all the time.
No divorcing spouse in their right mind would leave the mortgage or any other joint debt "as is".
45% DTI may put a borrower under pressure to meet their obligations, however it is totally approvable.
No divorcing spouse in their right mind would leave the mortgage or any other joint debt "as is".
45% DTI may put a borrower under pressure to meet their obligations, however it is totally approvable.
The vast MAJORITY of home owners do NOT refinance when they get a divorce. The spouse signs a quitclaim to the property and the decree spells out who is responsible. What world do you live in where 60+% of people are getting divorced and they're all refinancing their homes? It's not happening!
And 45% DTI? You're talking high risk borrower who is going to have an even higher interest rate because of the high risk and that then prices a lot of people further out of the market for what they can afford, and the foreclosure cycle continues.
The vast MAJORITY of home owners do NOT refinance when they get a divorce. The spouse signs a quitclaim to the property and the decree spells out who is responsible. What world do you live in where 60+% of people are getting divorced and they're all refinancing their homes? It's not happening!
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If he wants to buy a house, he will show his divorce decree and how he is not responsible for the mortgage. Millions of divorce people do it all the time.
People who get divorced, generally want things over and done with, except in cases where it might benefit the children...
The vast MAJORITY of home owners do NOT refinance when they get a divorce. The spouse signs a quitclaim to the property and the decree spells out who is responsible. What world do you live in where 60+% of people are getting divorced and they're all refinancing their homes? It's not happening!
You're probably right that the majority do not refinance. However, if one qualifies, it's certainly in the best interest of the spouse NOT getting the house that the spouse getting house refi. The divorce judge can say you don't own the house anymore, but unfortunately you can't divorce your mortgage. If the one who keeps the house ends up in delinquency or foreclosure, the credit of the ex who may not have lived there for 5 or 10 years still gets trashed.
You're probably right that the majority do not refinance. However, if one qualifies, it's certainly in the best interest of the spouse NOT getting the house that the spouse getting house refi. The divorce judge can say you don't own the house anymore, but unfortunately you can't divorce your mortgage. If the one who keeps the house ends up in delinquency or foreclosure, the credit of the ex who may not have lived there for 5 or 10 years still gets trashed.
The vast MAJORITY of home owners do NOT refinance when they get a divorce. The spouse signs a quitclaim to the property and the decree spells out who is responsible. What world do you live in where 60+% of people are getting divorced and they're all refinancing their homes? It's not happening!
And 45% DTI? You're talking high risk borrower who is going to have an even higher interest rate because of the high risk and that then prices a lot of people further out of the market for what they can afford, and the foreclosure cycle continues.
Every person I know who gets divorced has refinanced, usually under court order. If not, the spouse who leaves is still on the hook for the current loan. This debt would be counted against them for qualifying for a new home no matter if the decree states they are not responsible for the debt or not. If the spouse who stays misses a payment, do you think it hits the spouse who left's credit? Yep. Same with any other debts. The decree does not trump signed notes.
fyi-45% DTI does not add anything to the interest rate. You can qualify for an A-paper Fannie/Freddie/FHA loan at 45% DTI at the same exact terms as the borrower who has a 20% DTI.
If a borrower gets divorced and does not force the other spouse to refinance to get their name off the debt, they are a not very bright. You don't get to say...look here mr. creditor....the judge says she is responsible for the debt. The creditor will say....too bad...we have your both your signatures on the note here and we are holding you both responsible.
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