What to Do When Your Ex-Spouse Is Awarded the House
During Divorce Proceedings, but the Lender Still Looks to You
for the Mortgage Payments
During Divorce Proceedings, but the Lender Still Looks to You
for the Mortgage Payments
Question
Prior to getting divorced, my now former spouse and I purchased a home. We both signed the promissory note for the loan which is secured by the house. During our divorce, my spouse was awarded the house. I subsequently executed a deed which transferred my ownership interest in the property to my former spouse; however, my former spouse has never refinanced the loan which is secured by the property. I do not want to be responsible for paying a loan which is secured by an asset that I neither own or have the legal right to control. Nor do I want such a loan to impact my ability to purchase a replacement residence. What can I do?
Answer
The situation you describe is, unfortunately, not uncommon in Texas. We see it all the time. The best solution, albeit one which is no longer available in most cases we encounter, is to not allow this problem to occur in the first place. Where a litigant is represented by counsel during divorce proceedings, counsel should — at a minimum — advise the client to not agree to a settlement of the case on terms which would allow this situation to occur.
In cases where prevention is no longer an option, the best course of action can be determined only after a close and careful reading of the divorce decree. The remedy (or remedies) which might (or might not) be available will depend in large part on the precise language and provisions in a divorce decree.
Litigants in this situation often (mistakenly) assume that all that is needed is to go back to court and either ask the court to enforce a provision in the divorce decree that purports to require a refinance of the property or to obtain a new, supplemental order which contains such a provision. The problem with this strategy is that the spouse who was awarded the home will often claim (usually truthfully) that they do not have the financial ability to comply with such an order.
Thus, a more creative solution which takes into consideration all of the facts of a specific case is typically required.
Lapin Law Offices assists clients with asset protection, business law, family law, real estate law, trust and estate law, and other legal matters.
In cases where prevention is no longer an option, the best course of action can be determined only after a close and careful reading of the divorce decree. The remedy (or remedies) which might (or might not) be available will depend in large part on the precise language and provisions in a divorce decree.
Litigants in this situation often (mistakenly) assume that all that is needed is to go back to court and either ask the court to enforce a provision in the divorce decree that purports to require a refinance of the property or to obtain a new, supplemental order which contains such a provision. The problem with this strategy is that the spouse who was awarded the home will often claim (usually truthfully) that they do not have the financial ability to comply with such an order.
Thus, a more creative solution which takes into consideration all of the facts of a specific case is typically required.
Lapin Law Offices assists clients with asset protection, business law, family law, real estate law, trust and estate law, and other legal matters.