April 21, 2015
A reader asks, “My soon to be ex is on the deed but we’re both on the mortgage. He is working with the bank to complete a DIL. Do I have to be notified or agree to this since I’m on the mortgage? If the bank is going to forgive the debt shouldnt i know whats going on? I currently live in the house and concerned I will be evicted without warning.”
While there are a number of factors that may affect how an FHA mortgage loan is handled when a married couple is in the process of getting legally divorced, it should be pointed out that all parties that are legally/financially obligated on an FHA home loan have the right to contact the lender in such cases to get an update on the status of the loan if there are questions.
There are many issues that can affect what happens to a home purchased with an FHA loan when divorce proceedings begin. The simplest of these issues is whether or not the couple are obligated together on the FHA loan. More complex issues may involve community property laws–these are state laws that govern how financial obligations incurred in a legal marriage are divided in a divorce.
Not all states have community property laws, but many do. In such cases you may need to retain legal counsel to learn what your rights and responsibilities are–it’s best to speak to an expert in divorce law as it applies in your state.
In any cases, when it comes to divorce, all parties obligated on the home loan should contact the lender to discuss the situation and learn what options may be available. It’s never good to assume one outcome or to “trust the system” to work things out properly. An informed borrower or co-borrower will have a much better idea about what’s going on and be prepared for any negotiations that may need to take place regarding the home and the debt associated with it.
Do you have questions about FHA home loans? Ask us in the comments section.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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