Q: My husband was married previously, and through his divorce he agreed that his ex-wife could keep their former house. The divorce decree ordered her to make the mortgage payments and required her to refinance the home to take my husband’s name off the mortgage. However, she did neither or made her payments late. She recently passed away and the bank wants him to pay off the loan. We get at least three calls per day. We reached out to his ex-wife’s children but they have decided it’s not their problem. He’s offered to help them quick sell the home or let him do it, but they won’t talk to us and won’t give us a key to the home. They have told us that the just want the home taken back by the lender. We are just unsure what to do.
A: Let’s get this straight: Your husband is divorced, and in his divorce decree his ex-wife was given the house. She was also ordered to refinance the home but never did. What you didn’t tell us is if your husband conveyed his interest in the home to his ex-wife. If he conveyed his interest in the home to his ex-wife, there is little he can do here. He no longer owns the home. He can’t sell it and he can’t even transfer title to the lender in a deed-in-lieu of foreclosure.
Unfortunately, he and his ex-wife both signed the note and mortgage for the home, and they were both personally obligated to repay that debt. The divorce was between him and his ex-wife and not with the lender. His debt to the lender survived the divorce. If she had any assets, he can go after her estate. In the meantime, the lender has a right to pester him for repayment.
Your husband, on the other hand, is in a difficult situation. The longer the situation continues, the more likely the lender will proceed and foreclose on the home. Since your husband may not have the ability to sell the home in a short sale or work with the lender in a deed-in-lieu of foreclosure, his hands are somewhat tied, and he may have to wait and see what happens with the foreclosure.
full story via Post-divorce mess with distressed home – chicagotribune.com.