topic Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score? in Understanding FICO® Scoring

If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Fri, 29 Apr 2011 04:53:31 GMT

I am divorced and have been trying to get my name off my ex's mortgage to the house she was awarded in the decree seven years ago. She and her husband/lawyer claim that I am not being harmed by remaining on their mortgage. I need to provide the court with facts and information showing that this does hurt my credit to debt ratio thus affecting my FICO and borrowing power. It seems to be ridiculous that I have to prove it because it is a "no brainer" but the Judge is asking for documentation supporting this. Does anyone have something that I could give the court that would show that the ex is using my credit power on her house thus affecting my credit level, even though she has never missed a payment and only owes 60g at 4.75% that has 71/2 yrs left. Every tome I run a credit report for the purchase of something, "cars, house, etc.", her house shows up on my report and I get questioned. The decree is not specific enough without solid facts that the Judge is asking for. Please Help!

Thank You

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Lel — Fri, 29 Apr 2011 07:08:51 GMT

@Anonymous wrote:
I am divorced and have been trying to get my name off my ex's mortgage to the house she was awarded in the decree seven years ago. She and her husband/lawyer claim that I am not being harmed by remaining on their mortgage. I need to provide the court with facts and information showing that this does hurt my credit to debt ratio thus affecting my FICO and borrowing power. It seems to be ridiculous that I have to prove it because it is a "no brainer" but the Judge is asking for documentation supporting this. Does anyone have something that I could give the court that would show that the ex is using my credit power on her house thus affecting my credit level, even though she has never missed a payment and only owes 60g at 4.75% that has 71/2 yrs left. Every tome I run a credit report for the purchase of something, "cars, house, etc.", her house shows up on my report and I get questioned. The decree is not specific enough without solid facts that the Judge is asking for. Please Help!

Thank You

Hello, and welcome to the FICO Forums.

In general, the only way to remove yourself from the mortgage obligation of your former home would be for your ex-wife to refinance the loan in her name only (or jointly with her new husband). In situations like yours, there is often a requirement in the divorce settlement that this refinance take place within a specified time period. The fact that you have been unable to compel them to do so for the past seven years indicates that no such stipulation was included in the settlement.

Currently, your ex is not using your credit in any way that is beneficial to her. That is, your credit history, credit score, and income are not playing a factor in any new credit application that she pursues. However, the fact that you are still on the mortgage loan put your credit history at risk, because as far the the lender is concerned you are still jointly responsible for the payment of the loan. If you ex were late on any payments or if she were to default on the loan, your credit history will be negatively impacted and you can still be held liable for the payment of the debt.

I don't know anything about was sort of legal recourse you might have in the absence of a refinancing requirement, but perhaps if you are able to demonstrate clear harm from remaining on the loan - for example, being unable to purchase a new home for yourself because the outstanding debt on your former home - then maybe you would have a case.

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Fri, 29 Apr 2011 18:30:26 GMT

ETA: Welcome! Glad you're here!

I would consider it from the DTI perspective - the numbers there are pretty straightforward.

And consider the judge's requirement for you to provide documentation as a door being opened. Requiring documentation doesn't mean they disagree with you, simply that they need something concrete to work with.

I'm curious about court costs when anyone mentions a judge. Are you currently in the market for a new home? Or simply uncomfortable with it reporting for you?

Is it worth the court/attorney fees to demand the change? (We've just had a boatload sucked into the legal industry so I'm, uh, sensitive to this issue.)

And, any possibility they (former spouse and her current husband) would consider a refi given just the DTI argument? If you drop the "you're damaging my FICO and/or using my credit power" argument and focus on "my DTI is misleading and damaging my opportunities to purchase a home" would you have better luck getting this to move forward?

best wishes to you

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Fri, 29 Apr 2011 20:47:50 GMT

I think it's helping. If I use the simulator on Experian and remove my ex's mortgage, my score drops. And that one is still at 90% util. He also pays on time every time. Several people let me know a divorce decree is not enough to remove your name from the mortgage. We did some paperwork that is supposed to do it without a re-fi, but we'll see if it works. I'm hoping to get a mortgage for myself soon and honestly I think it's better to have the existing one on the credit score, and show them documentation that I don't have to pay the monthly payment out of my income.

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

veracious — Fri, 29 Apr 2011 23:41:27 GMT

@Anonymous wrote:
I think it's helping. If I use the simulator on Experian and remove my ex's mortgage, my score drops. And that one is still at 90% util. He also pays on time every time. Several people let me know a divorce decree is not enough to remove your name from the mortgage. We did some paperwork that is supposed to do it without a re-fi, but we'll see if it works.
I'm hoping to get a mortgage for myself soon and honestly I think it's better to have the existing one on the credit score, and show them documentation that I don't have to pay the monthly payment out of my income

jesirose, if you are talking about a quit claim deed., unfortunately that won't work.

Unfortunately, as both the moderators have stated, after a divorce, the only way to get your name off the title/mortgage is for your
former spouse to refi and assume full responsibility for the loan. A quit claim only pertains to title on the property.
It has nothing to do with the mortgage. Disclaimer: I 'm not an attorney, but I've been through an experience similar to yours.

edtied to add: If you find a solution let us know.

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Sat, 30 Apr 2011 15:05:44 GMT

The letter was given to us by an attorney. It's for a mortgage assumption. You can do a mortgage assumption to get out of your own mortgage without the person who wants the home having to finance. Basically it's as if my ex and I are giving the mortgage to a new person, who just happens to be my ex. It's not normally meant for this situation so that's why I don't know if it will work. I've been dragging my feet because like I said, the mortgage is actually helping my credit right now. (IMO)

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

veracious — Sat, 30 Apr 2011 17:02:19 GMT

Thanks for replying , jesirose.

Interesting tactic you have going with your atty. One question though, does your bank/mortgage holder have to approve the assumption?

I would think there would be fees involved. Given today's low mortgage rates,your ex could re-fi.

Is the risk worth it to you to continue to carry a liability for the sake of your scores?

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Noctilum — Sat, 30 Apr 2011 17:49:19 GMT

I know our mortage company had to approve the assumption (which they didn't) so I am stuck on the mortage until my ex either sells or re-fi's.

@veracious wrote:
Thanks for replying , jesirose.
Interesting tactic you have going with your atty. One question though, does your bank/mortgage holder have to approve the assumption?

I would think there would be fees involved. Given today's low mortgage rates,your ex could re-fi.
Is the risk worth it to you to continue to carry a liability for the sake of your scores?

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Sat, 30 Apr 2011 19:08:16 GMT

Considering his score has always been 750+ and he never pays anything late, I don't consider it a liability. If anything I've hurt his with a cosigned student loan I kept paying late on (but they didn't report it, thankfully) We have a good relationship still. He can't get a lower rate now than he already has on it and doesn't want to re-fi.

The fee is $125, and the bank does have to approve it.

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

veracious — Sat, 30 Apr 2011 19:36:02 GMT

jesirose, I hope I didn't offend in any way.

I was trying to help you see that the positives can outweigh the negatives more often than not.

Without bringing up a lot of negatives about how you could possibly be harmed by an unforeseen event,

I'll just wish you the best of luck in rebuilding your scores.

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Thu, 10 Apr 2014 21:48:43 GMT

I have a similar but different topic here - My ex-husband and I had a Property Settlement Agreement which stipulated that he was to re-finance our jointly owned home in order to remove me from the mortgage (and a Quitclaim Deed to remove me from the Deed); this was signed in December '13. Our Final Divorce Decree was not final, however, until February 25, 2014, which set the clock ticking for him to then take care of the re-finance, which was just finalized on April 1st. So, I look at my credit reports today to see if his mortgage company has reported the account closed and that the mortgage is no longer included on my credit report and is no longer a debt in my name. Well, it was removed from two reporting agencies so far, with the 3rd one posting soon, I guess. However, I was shocked to see how far my credit score dropped by about 40 points!! I now have no significant debt, have one credit card with $150 balance, paid off my car loan in January, paid off debts that were over 120 days old (due to paying an attorney for a year the grand total of $20,000 and no money left over every month to also pay 5 credit card accounts - two Visa's and 3 store cards). The credit cards were fully paid off also in January and my score was starting to rise towards 628 after months of it being in the mid-500's to upper 500's due to divorce crazyness, legal fees, living on my own and supporting two teenagers, etc.

I'm working so hard to save money, to have no debt, increase my credit score and to buy my own small home for me and my two kids (one of which is leaving for college in the Fall). I am removed from the largest debt now - a home mortgage in the amount of approx. $370,000, and look what happens to me - my scores all drop by @40 points!!! It's just not fair....

Will the scores rise again in a month or two? Should I contact a reputable credit repair company to help me remove derogatory remarks from my credit report (I've tried writing goodwill letters to the banks owning the previous credit card debt that I paid)? What in the world can I do now to increase my credit score? BTW - I've got one active credit card only now with a credit limit of $1,000 (a secured card) and the balance is $150 as I stated above. Should I apply for another credit card at this time even though there will be another slight hit to my credit score but a temporary one? HELP! Thank you....

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Thu, 10 Apr 2014 21:55:25 GMT

Removing an installment loan from your reports can cause scores to drop, but helps your DTI in the process.

What I'd suggest is posting the details of your situation in the rebuilding forum, where you can get some wise counsel on the best steps to take next.

Re: If I removed my name off my Ex's mortgage, how will that improve my FICO Score?

Anonymous — Thu, 10 Apr 2014 22:02:47 GMT

OK - I'll do that - thank you!