Divorce and Ch 13 cont'd....what would you do?

[brtb]

Here are my two options. I think I know which one I'm going to go with, but am curious as to which you would do and why.

Option 1: Stay in Chapter 13, but file a separate plan from ex-spouse, 2 1/2 years complete out of a 5 year plan, and keep house. First and second mortgage; both are current. There is equity in the home.

Option 2: Convert to Chapter 7, lose house, easier path to a quicker "fresh start"

Thanks!

[ValleYum]

Option 2. I like the Fresh Start option.

ETA the "Why?" part of the question: Why? If it has been a marriage in name only for years past and you never want to see him again (sounds like no kids, maybe? hopefully?) then put him in your rearview mirror ASAP!

Good luck!!

[dmc-2008]

I like valley's idea, but I think u are invested in the house and don't see another property in your future! I would stick with keep the house ditch the dude!!!!

[ValleYum]

I like valley's idea, but I think u are invested in the house and don't see another property in your future! I would stick with keep the house ditch the dude!!!!

If she stays she needs to budget $$ for a totally AWESOME master bedroom do-over (paint, bedding, furniture rearrangement)!!! Anf change the locks & garage door codes! LOLOL

[dmc-2008]

Yes! A super makeover, done on the cheap! ;-). You can make this work

[filingin08]

If you have kids together and if you can afford, my choice would be Option 1. Otherwise, I'd likely chose a complete fresh start over equity.

[brtb]

Wow, so many great answers, and now I'm more confused then ever. Background: Married 16 years, no kids, he's cheating, and I'm done.

I have been leaning towards option one. Mainly because once this is all over at least I'll have a property. If I get rid of this house will I ever be able to buy again? The house does need a little work (i.e. new a/c unit, fresh paint, cosmetic stuff). I've also been thinking about the tax implications. When I go to Single status next year and I have no deductions I think it will be painful. Am I right or not?

Option 2 is also so tempting. Truly a fresh start. But, rent where I live in a safe, nice neighborhood for a one bedroom one bath (Northern VA) would be about the same if not more than what my mortgage payment is.

I'm torn...

[brtb]

Just wanted to add one more thing. Potential problem of keeping the house would be trying to refinance it in my name only while in Ch. 13. Has anyone been successful in doing that recently?

I don't know if this is true or not, but in my research I'm seeing that it might be possible to refinance a conventional loan to a FHA loan.

[dmc-2008]

I dont know about refi, but the best thing is keep it. You better not let that cheating sob have it and dont lose it!!!

[ValleYum]

I dont know about refi, but the best thing is keep it. You better not let that cheating sob have it and dont lose it!!!

Without a refi she remains financially tied to him, though. Blech.

This is a tough decision.

[brtb]

I don't think I can get him off the deed without a refi. It's still early. The Property Settlement Agreement still hasn't been sent to him, but still keeping my fingers crossed. Someone has to have had to refi while in Chapter 13. Anyone? Again, I think FHA could be an option, but not 100% sure about that.

[LadyInTheRed]

But, rent where I live in a safe, nice neighborhood for a one bedroom one bath (Northern VA) would be about the same if not more than what my mortgage payment is.

That's a very strong argument towards keeping the house. Talk to a very experienced mortgage broker about refinancing.

Is there so much equity in the house that keeping it in a Chap 7 isn't an option?

[Slingerland]

FYI and for whatever it's worth, the HARP 2.0 refi program will allow for ex-spouses to be removed from the mortgage without re-verifying the DTI ratio. (I've been refi-ing my rental properties to get my Ex off them).

But I'm not sure about whether this will work in a C-13.

[brtb]

That's a very strong argument towards keeping the house. Talk to a very experienced mortgage broker about refinancing.

Is there so much equity in the house that keeping it in a Chap 7 isn't an option?

I was anxiously waiting your response, Lady In Red.

Yes we have about $50K equity in the house right now. Virginia's Homestead Exemption is only $5K. That's why I really want to stay in this house and finish out my Ch. 13.

[brtb]

FYI and for whatever it's worth, the HARP 2.0 refi program will allow for ex-spouses to be removed from the mortgage without re-verifying the DTI ratio. (I've been refi-ing my rental properties to get my Ex off them).

But I'm not sure about whether this will work in a C-13.

I was researching HARP, but the way I understood it was that your current loan has to be an FHA loan in order to refinance. Please correct me if I'm wrong.