Home > arizona mortgage, arizona mortgages, arizona real estate, az mortgage, az mortgages, az real estate, mortgage az > AZ Mortgage Question of the Day: IF my ex-husband signs a quit claim deed, does that remove him from the mortgage liability?

AZ Mortgage Question of the Day: IF my ex-husband signs a quit claim deed, does that remove him from the mortgage liability?


AZ Mortgage Question of the Day:  IF my ex-husband signs a quit claim deed, does that remove him from the mortgage liability?

 

No.  The quit claim deed ONLY deeds the ASSET of the property to the remaining party.  It does not remove responsibility from the mortgage.  The mortgage would need to be refinanced with the remaining borrower qualifying to carry the mortgage alone.  Once the new mortgage is closed, the escrow company would take care of recording the new deed in the remaining party’s name.

IF the one borrower signs a Quit Claim deed but does not have the remaining borrower refinance, BOTH borrowers are still liable on the mortgage and it’s repayment requirements.  It also will remain on BOTH borrower’s credit reports. 

Many borrower’s make this mistake during a divorce.  Especially if they are trying to handle their divorce without an attorney.  It makes sense that if a borrower deeds the ASSET to the other party, that also transfers the mortgage liability, however this is not the case.  It is very important to handle this correctly during the proceedings as it can affect the leaving party in their ability to mortgage qualify down the road.  Providing the divorce decree and the quit claim deed will not suffice in removing the mortgage liability when qualifying.

Having a dream is good, owning one is better!

 

 

Leslie Pelletiere, Owner

First Class Financial Services, proudly mortgage lending since 1999!

602.294.9288(O)

602.294.9830(F)

www.fcfs.net

MB#0902810

NMLS #162494

AZDFI Loan Officer # LO-0911453

 

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