Buying my house back

[Anonymous]

I'm going through a divorce right now and expect the judge will order the house to be sold. If so I assume it will be a Short Sale. If this is the case will I have the option to buy it back? We are upside down on the house, current mortgage is $211,000 and local values (zillow.com) show the house to valued at $147,000.

Regards,

ScrewyLouie

[drkaje]

First of all, good luck. Divorce is a big change but survivable.

Try asking Shane or Dallas from the mortgage forum. They may have some experience or even know who to approach (and more importantly how) at the mortgage company. It may be doable in a way that minimalizes the impact on your credit.

[llecs]

Moving it over to Mortgage Loans.

ETA....OP, ignore Zillow's values, but rely on an agent to value it off the neighborhood comps. Mine's lower by $25k-$50k right now.

[StartingOver10]

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@Anonymous wrote:

I'm going through a divorce right now and expect the judge will order the house to be sold. If so I assume it will be a Short Sale. If this is the case will I have the option to buy it back? We are upside down on the house, current mortgage is $211,000 and local values (zillow.com) show the house to valued at $147,000.

Regards,

ScrewyLouie

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I am sorry to hear of your divorce. Unfortunately, you can not buy back your home in a short sale. All short sales have to be "Arms Length Transactions" and you sign an Affidavit at the contract and again at the closing attesting you are not related to the seller. Naturally, since you are one of the seller's you can't attest that you are unrelated. Not only that, but your ownership is public record, so it is available for any and all to see, including the bank.

Also, it is considered mortgage fraud if you send someone else in to buy the house for you in the short sale. I'm a Realtor and sell short sales every day - this is
rule #1 and no way around it. However, it doesn't prevent you from purchasing another home. The issue you will have in the next home purchase is the time frame since you will have a short sale on your credit and public record. The minimum time period is 2 yrs after your short sale closes before you can obtain financing again. There are some exceptions to this with private owner financing, but that is relatively rare still.

[webhopper]

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@Anonymous wrote:

I'm going through a divorce right now and expect the judge will order the house to be sold. If so I assume it will be a Short Sale. If this is the case will I have the option to buy it back? We are upside down on the house, current mortgage is $211,000 and local values (zillow.com) show the house to valued at $147,000.

Regards,

ScrewyLouie

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Instead of doing a short sale, perhaps the OP can apply for financing to refinance the loan in his own name... IF its an FHA mortgage, he can do a streamlined refinance

[Familywantsahouse]

I'm assuming you have an attorney? If you can afford the mortgage on your own I'd be fighting to keep things as is until the value would support a refinance.

[drkaje]

My initial post got lost in movement, LOL!

I'd do what made the most numerical sense. If the house has to be sold so the ex can get half, adding $75Kish debt to an already underwater house doesn't make mathmatical sense to me.

It would stink but being further underwater and deeper in debt will probably cost too much compared to moving on.

[GregB]

First, why do you think that the judge will order the house to be sold?

If that is actually happens, it would be difficult to understand how it could be possible for either party to buy any house in the near future. StartingOver10 already made it clear why you can't use this process to cheat the bank.

Will you have tax consequences from the short sale?

Both parties are likely to have their finances trashed during the divorce. It is very rare that either one will be able to keep a house with a high loan to value after a divorce.

Only an attorney that is experienced in your court and is familiar with the judge can make a good guess about what the judge will do. Even then, most judges amaze people with bizarre, arbitrary, and stupid decisions. Most courts are simply overloaded with idiots getting a divorce and are forced to keep the system moving. I assure you that even the most stable and intelligent people behave like idiots frequently during a divorce.