Still getting a mortgage loan with a foreclosure? - Located in Chicago

I decided I wanted to buy a home so after speaking with a few lenders I  made the decision to go forward with a pre-approval. It showed on my credit I had a foreclosure. I had no idea what it was and after much investigation I learn that it is the home my ex wife and I bought some years ago. 1) I had no idea I was still responsible for the mortgage since I signed over the deed to her and thought that was it 2) I had no idea she foreclosed on the home. Is there still a way to get a mortgage loan  I have stable income and good credit of 739? I would hate to think that my ex wife foreclosing on the home (I handed over to her during our divorce),without me knowing will keep me from getting a loan and buying a new home.

  • October 02 2013 - Manhattan
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Answers (10)

Your divorce decree must specifically state that your ex-wife is responsible for the property and mortgage.  Based on your post below, the decree does state the property and mortgage are her responsibility.  As long as the Divorce Decree is dated prior to Foreclosure date, the Foreclosure should not affect your ability to obtain a new mortgage.  
  • February 05 2014
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Yes, you would be able to get a loan again but not under conventional financing. We have an unique portfolio loan program that would allow it. It requires a 20% down-payment.

Sorry, but the fact that you did a quit claim on the deed does not release you from the note. The only way you could get off of it was to refinance with her being the sole borrower. In your scenario you would have no claim to the house anymore, but would still be responsible to pay for it.

Good luck! Let me know if I can help.
  • February 04 2014
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You should be okay by providing the divorce decree. Also, you could be within the new FHA program called, Back to Work, which allows for economic circumstances surrounding a foreclosure. It allows 1 year after a foreclosure. Either way, use the Find a Pro link on this site to find a local lender with good reviews to assist. Whatever you do, just understand that you have to find the right lender with the actual ability to do this and willing to walk you through from application to closing.
  • October 02 2013
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I checked with my underwriter to be sure before I answered your question.
Since the divorce decree stated that she was solely responsible for all payments on that property and you removed yourself from title then the foreclosure will not be held against you. The divorce decree has to be a court approved decree(which it sounds like it was). 
 You should be ok to proceed as long as the rest of your credit profile, income, and assets are acceptable. 
  • October 02 2013
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This is a tough situation because your name still must have been on the mortgage. There might be some lenders that are willing to accept a letter of explanation to dismiss the foreclosure. You should speak with a lender to see if anyone can help you out in this situation. Well I hope this helps! If you have any further questions or if you would like a loan, feel free to contact me!

Good Luck!
  • October 02 2013
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The divorce was in 2006. Divorce decree says: "the respondent (me)  is to quit claim to the petitioner his interest in the marital residence and the petitioner is to pay the mortgage and all other expenses connected with the property". Unfortunately I was only 25 at the time and thought I was signing off on all responsibility.
  • October 02 2013
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Profile picture for GMerino

This happened last year, how long ago was the divorce and does the divorce decree show that your wife is now responsible for that mortgage payment?

  • October 02 2013
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Profile picture for Andrew Malak
It depends how far ago you transfer over the title to her.
  • October 02 2013
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The foreclosure was August 2012
  • October 02 2013
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Profile picture for GMerino
How long ago did the foreclosure happen?  It may or may not affect you in getting a loan. 
  • October 02 2013
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