Divorce Before Closing

Divorce Before Closing

A buyer who’s in the middle of a divorce and who’s scheduled to close on a house before the divorce is final. Who alone qualified for the financing, and is taking title in there name only. The lender is insisting that her soon-to-be-former spouse sign the mortgage agreement. Why? 

The mortgage agreement gives the lender the right to foreclose if the borrower defaults on the loan. However, a spouse who hasn’t signed the mortgage agreement may be able to assert homestead rights, making it difficult for the lender to foreclose. So, if property could be considered the buyer’s homestead, most lenders will require the non-owning spouse to sign the mortgage agreement for the sole purpose of waiving homestead rights. Therefore, it’s a good idea for the mortgage to include language stating that the spouse is signing only to satisfy the spousal joinder requirement contained in the Florida Constitution and that the spouse is not assuming any liability or obligations in the note or mortgage. In addition, the non-owning spouse should always review the mortgage agreement carefully to ensure the terms are consistent with his or her understanding. 

Keith and Patty Thomsen Headshot
Phone: 561-567-1733
Dated: August 30th 2017
Views: 26
About Keith and Patty: ...

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