My (now ex-)girlfriend and I purchased a home a little over 3 years ago on a mortgage. We refinanced the mortgage last November. Now we've split up...she's moving out of town & I'm moving back into the home at the beginning of next month. Due to the drop in the property value, my current financial status (Employed & able to pay the mortgage and bills, but not employed at a high-enough position to equal both of our previous incomes), and the general state of the economy, a refinance at this point isn't possible.
I will be taking over all mortgage payments & anything house-related, though her name will remain on the loan. Is there a certain type of legal document that I can have the two of us sign & get notarized to relinquish her interest in the property?
I just want to have myself covered in all ways, so down the road she can't say "technically this house is mine" or file the mortgage as part of her taxes, or whatever else she could do with it. I intend to have her taken off the mortgage and solo-refinance it when the opportunity is made available.
Also, what would be some things that could benefit her from signing this? (To help me convince her to do it...)
Thank you very much for any help & support you can provide!
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Complex issue. Think you need legal help to protect your assets. DIY might be a problem; you want this to be impossible for her.
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Yes. It's called a quit-claim deed. However, if her name is still on the loan, she may technically have a way to get around it in the future.
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It's called a Quit Claim Deed. YOu can usually get the forms for it at an office supply store that provides all kinds of legal forms. YOu can buy a packet of 10 or 12 so you can have plenty to practice on. Essentially the both of you are selling the house to just you, or she is saying she has no more interest in the house and is selling her interest to you for $1 and O.C. (other consideration). You both sign it in the presence of a notary public, and you immediately file it with the county clerk and recorder's office (country treasurer or maybe its called the tax assessor's office). Be sure to pay her the $1.
Make sure you coordinate with your mortgage company on this. They may have included her income as part of the total income figure they used to determine whether or not to give you a loan. They may have to rewrite the loan with just your name on it.
You might persuade her by telling her she won't have to pay half the real estate taxes any longer, or part of the mortgage. She won't have to pay for repairs if her name isn't on the house. If she wants to keep her name on the house, then insist that she pay for these things. That should be enough to motivate her to cut her losses, since she is probably paying for rent or a mortgage somewhere else. Not may people can afford to pay for two residences at the same time.
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In order to get her off mortgage and off title, you need to do a refi and new deed and new mortgage
Otherwise, her name remains on title and mortgage, and it can prevent her from being able to buy another place
You should definitely have written agreement between you, stating who put up money for down payment when you bought the place, who paid the bills during your co-habitation, that it is agreed that you will pay all bills in future and be responsible for mortgage, RE taxes, utilities from this point forward and HOLD HARMLESS your GF from this point forward, that in return she is signing a QC Deed to you, which will be recorded at time you can refinance the property in your sole name.
Should consider having an attorney draw up doc, but you can do it, both sign and get it notarized.
A sweetener for her would be you returning to her her share of down payment, if any. As home value has declined, there is no increased value to be split out between you. Or you could offer to pay her something upon the sale or refi of property, using a formula or a set $ amount. You both needed a place to live and would have had costs, so most monthly payments can be allocated to normal living costs. Another sweetener to her is you agreeing to Hold her Harmless.
BTW: A QuitClaim Deed is a valid and binding deed, it is NOT informal and it is RECOGNIZED by lenders. In fact, signing a QC deed violates the mortgage with your lender, and they can accelerate loan and demand you pay it off. However, if it is NOT recorded, the lender is not aware of the deed, but neither you nor Ex are protected by non-recorded document.
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