Profile picture for Karen192

I agreed to sign a quit claim deed in the divorce decree. Will I always be liable for the debt?

I understand I will still be liable for the debt regardless of the divorce decree stating that my ex is responsible for the debt on the home which he is short selling.  How does my name get off the debt if the legal documents don't hold any weight?
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May 19 2009 - Clearfield
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Profile picture for Pasadenan
If that is the case, there seems to be a misunderstanding of the situation.

If it was being sold short in 2009, the judge would not have mandated the splitting of the equity after the sale, as there would have been no equity.

And the market values in Clearfield UT have not improved any over the past 3 years.  10.3% decline in just the past year alone.

Besides, on the other two threads the new user started, the location is indicated Stafford Virginia on both.
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June 01 2012
I just assumed that User496-2914 and Karen were same person (new profile) coming back 3 years later because the problem was not resolved since she said "We divorced 2009"

looking for new help on old problem
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May 31 2012
Profile picture for Pasadenan
May 2009???

This problem has been resolved a long time ago.
But User496-2914 apparently has a similar situation.

And that is not a "short sale" situation since she mentions that the court order requires her to get her share of the equity when liquidated.

Sunnyview's suggestions for User496-2914 are excellent.

I have no clue what Larry is referring to as it doesn't apply to the present question at hand, which should have been in a new thread instead of a similar old thread.
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May 31 2012
you mention that he has the house priced above market.  I did not assume that the value of the house is less than the mortgage.  

It sounded to me like he simply has the home overpriced to avoid selling it.   Getting a CMA will help shed light on that fact if you do petition the court to get the property listed at market value.
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May 31 2012
For one thing, you already signed the agreement, and your signature should greatly simplify the inevitable transfer of title. 

For another, there will be no equity for you to share in after the short sale closes.

Further, in my opinion, the lender will want the same proofs of inability to pay as your husband must provide -- otherwise, they won't agree to a short sale.  Why should they?  If the lender knows you are tapped out, you are probably in the clear, although your credit rating will be hurting for a few years.  Time to rent!

When lenders come after ex-homeowners for the difference between short sale prices and the original mortgages, they are looking for  deficiency judgements that will allow lenders the right collect the $$$.  In some states, borrowers remain personally liable, but in others, like California, they are exempt from deficiency judgements on their homes.

In practice, many lenders just bite the bullet and swallow the loss, not wanting to come across as spiteful Scrooges. Why, that would harm their neighborly image.

You have an attorney, yes?  Check with the attorney and ask him/her to inquire of title attorneys if uncertain of the correct answers.
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May 31 2012

just chiming in to agree with sunnyview and wetdawgs, it's not going to be fun but you're going to need to take action.  signing the quit claim deed will just make things worse.   Call around to visit with listing agents, if you can find one that has a lawyer IN the office that's even better.  

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May 31 2012
Profile picture for sunnyview
4962154, I am not an attorney. Please do NOT sign any quit claim. Giving him legal control of your house with your credit attached is a nightmare. You need to get back to court even without an attorney to petition the judge for an order to sell the house. The court clerk can often tell you what paperwork to file without giving legal advice. It does not have to be fancy, but it needs to ask for enforcement of the original divorce decree.

You could petition the court to kick your ex out of the house and give you legal possession so you can sell it, but short of that at least get that house listed and sold to save your credit.

Come to court with two CMA's with timeframes for sale at a 30 day, 60 day and number of average days on market price. Ask the court for an order to list the house with automatic price decreases every 21 days or until the property is sold up to the amount of the current mortgage plus commission and escrow.

Choose an agent before you go into court to list the property with a lockbox in the MLS and bring the listing agreement with you to be signed by you and your ex. You can hire an attorney to do it, but at least consider asking the court for enforcement of the original decree with some structure and timelines.
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May 31 2012
Profile picture for wetdawgs
@user4962154:   the moment you sign the quit claim deed, you lose all rights to the home.  A quit claim deed does not remove you from the mortgage nor the obligations of the mortgage.

Therefore, the appropriate response:    "I'll be happy to sign the quit claim deed after I've received my share of the equity with market value of (date of divorce) and I have received documentation to show that you've refinanced in your name."

The judge's decision in the divorce carries no obligation for the lender but orders for the two of you to take the appropriate actions.  

I suspect at this point you will have to take legal action.


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May 31 2012
Profile picture for user4962154
Just read the statements about the quit claim...I hope I understand exactly the facts about what it is and what it means and does not mean. Here is my sitiuation...my ex hubsand lives in the house we bought together in 1987, stafford county va. We divorced 2009. I remarried. He still lives in that house  but the divorce documents say he has to sell it and give me a percentage of the sale. Of course he has the for sale sign in the front yard but has the price of the house 100,000 above what the market calls for. He is stalling the sale of the house. I cant afford an attorney to haul him into court proving he is upholding the sale. etc...anyway, my ex husband now wants me to sign a quit claim. He tells me that my name would be removed and responsibility from the deed and loan, that it will also not effect my receiving money upon the sale of the house as per the divorce decree. From what I have read here and understand,  there is no reason to sign a quit claim. I would lose any interest in the property, all financial decisions he would be in control of and my credit will be effected. He already has ruined my credit by not paying the mortgage. Pays it when he feels like it. Bank calls me to inform me of late payments. The judge put in the divorce decree stated that he is to sell the house, give me a percentage of the sale and he is to pay the mortgage. But since he doesnt pay the mortgage on time, late payments etc, the bank doesnt care what the judge says. My name is on the mortgage as well and I am being held responsibile for the mortgage like he is. My credit is ruined and he thinks I will or should sign the quit claim. Your thoughts would be deeply appreciated, thankyou. 
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May 31 2012
Profile picture for Mr Caveat
essentially the only difference in your situation from before the divorce and after is that you lose the right to make the financial decisions... if you were to sell the house, short sell, foreclose, refinance, pay off the mort, then the debt would be cleared, but the quit claim deed essentially leaves the "details" up to your ex... your divorce lawyer really goofed, if you had one.
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May 25 2009

No one is wrong when stating seek an attorney for advice. 

To be released from the debt BY THE BANK THAT YOU OWE THE MONEY TO you would have to sell the house and/or the remaining person would have to re-finance or and very unlikely is to have the bank release you just because they think it is a swell idea.

I have never heard of a person being released from a debt because of a quit claim deed. 

So based on that premise unless the bank releases you, you owe the money and your credit is on the hook.

I am a licensed real estate agent and my area of expertise is real estate.

I am not going to pretend I am an attorney and I am giving generic answers with just basic info, not to be confused with legal advice.


From Wikipedia, the free encyclopedia

A quitclaim deed is a term used to describe a document by which a person (the "grantor") disclaims any interest the grantor may have in a piece of real property and passes that claim to another person (the grantee). A quitclaim deed neither warrants nor professes that the grantor's claim is valid. By contrast, the deeds normally used for real estate sales (called grant deeds or warranty deeds, depending on the jurisdiction) contain guarantees from the grantor to the grantee that the title is clear. The exact nature of the warranties varies from jurisdiction to jurisdiction. Quitclaim deeds are sometimes used for transfers between family members, gifts, placing personal property into a business entity, or to eliminate clouds on title, or in other special or unusual circumstances.

The most common use for a quit claim deed is, in a divorce situation, where one party is granting the other full rights to, and eliminating any interest in, a property in which both parties held an interest. If a husband and wife own a home and divorce, and the wife acquires the home in the decree, the husband would enact a quit claim deed to eliminate interest in the property. The husband's name would remain on the loan and he would be financially responsible or liable if the wife were to default on the property. However, he would have no interest in the property—if the wife sold the property, the husband would have no claim to money gained from the sale. Another example of a circumstance where a quitclaim may be used is where one spouse is disclaiming any interest in property that the other spouse owns.

Quitclaim deeds are also typically provided in cases of Tax deed sales where property is auctioned off to pay outstanding tax debt.
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May 25 2009
Only an attorney can answer that question.  And the answer will probably vary depending on State Laws.

My advice is to  consult an attorney and get professional advice!
A Realtor or any real estate agent can answer questions about property and a transaction that is their level of expertice.  Your asking a question about the law.   As a licensee in the State of NH,My lxpertice is real estate.  Finite!
Ironically only unlicensed people can give advice and not be responsible for giving the right answers. This is a "Caveat".

Caveat venditor"Let the seller beware".

Caveat emptor is Latin for "Let the buyer beware."  
I hope this helps ! 
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May 25 2009
Greg is correct about asking an attorney.
However let's look at the facts.

A quit claim deed is simply a deed that says, If I have any claims on this property I quit them.

It has nothing to do with the loan it is only about the title. So unless the mortgage company sends a release you owe the money.

It is a very common misconception that a quit claim deed releases you from the debt. 



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May 25 2009
Karen,
That is a question that you should ask you lawyer.  A realtor is not qualified to answer this question.

Greg Jensen
Prudential UT Real Estate
http://utahmountainhomes.com
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May 20 2009
 
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