Hi everyone, background is below:
My DH owned a house with his ex-wife. There are two mortgages on this house and it has about $40K in equity in it. My DH pays the 2nd mortgage and the ex pays the primary mortgage. His name is on the deed and the divorce decree says they are both equally responsible for both mortgages. Ex lives in the house and does not want to move.
My DH owns a home, in his name only, that is underwater. We are attempting to do a short sale on this property and it will close very soon. The lender wants him to sign a promissory note for $80K so, upon the advice of the attorney, my DH filed a Chapter 13.
I was working until recently and my earnings bumped my DH above the median. With my earnings, he is at a 100% plan. The only things in the plan are the attorney's fees and some small-ish credit card debt (about $15K).
DH told his ex about the filing and asked her to refinance the house. Before having this conversation with his ex he spoke to the attorney who said there would be no issues with the ex refinancing.
This is after the attorney completely missed the fact that DH's name is in the deed on the house with his ex.
It all blew up today. The ex can't refinance because there is a small amount of equity in the house. Now the attorney says DH can't do a Chapter 7 (which he should qualify for within 6 months of my last paycheck) because of this equity. So now he's saying that DH should get out of the plan early so that the house can be refinanced but the only way to get out early is if DH stays at 100% plan.
Sorry, I'm sure I'm missing some of the facts here.
DH keeps telling the ex that we'll keep making the payments on the 2nd mortgage. She is freaking out. Thinking that his creditors are going to take the house.
Is the attorney correct that DH can't do a 7 because of the equity in this home? What would happen to the equity if he did a 7? There is a homestead exemption here but the amount is less than the equity and DH hasn't lived in this home in about 7 years so it isn't his homestead (does that matter)? Would DH's creditors force the sale of the house?
If DH goes to the court due to his change income (due to my not working) and the plan is redone and he's below the median and what would happen if there is nothing left over to pay the creditors anything? Could the court force his ex to sell?
I'm really annoyed that the attorney didn't warn us about this problem. Apparently they didn't realize DH was on the deed even though I know I told his to them.
Any advice?
My DH owned a house with his ex-wife. There are two mortgages on this house and it has about $40K in equity in it. My DH pays the 2nd mortgage and the ex pays the primary mortgage. His name is on the deed and the divorce decree says they are both equally responsible for both mortgages. Ex lives in the house and does not want to move.
My DH owns a home, in his name only, that is underwater. We are attempting to do a short sale on this property and it will close very soon. The lender wants him to sign a promissory note for $80K so, upon the advice of the attorney, my DH filed a Chapter 13.
I was working until recently and my earnings bumped my DH above the median. With my earnings, he is at a 100% plan. The only things in the plan are the attorney's fees and some small-ish credit card debt (about $15K).
DH told his ex about the filing and asked her to refinance the house. Before having this conversation with his ex he spoke to the attorney who said there would be no issues with the ex refinancing.
This is after the attorney completely missed the fact that DH's name is in the deed on the house with his ex.
It all blew up today. The ex can't refinance because there is a small amount of equity in the house. Now the attorney says DH can't do a Chapter 7 (which he should qualify for within 6 months of my last paycheck) because of this equity. So now he's saying that DH should get out of the plan early so that the house can be refinanced but the only way to get out early is if DH stays at 100% plan.
Sorry, I'm sure I'm missing some of the facts here.
DH keeps telling the ex that we'll keep making the payments on the 2nd mortgage. She is freaking out. Thinking that his creditors are going to take the house.
Is the attorney correct that DH can't do a 7 because of the equity in this home? What would happen to the equity if he did a 7? There is a homestead exemption here but the amount is less than the equity and DH hasn't lived in this home in about 7 years so it isn't his homestead (does that matter)? Would DH's creditors force the sale of the house?
If DH goes to the court due to his change income (due to my not working) and the plan is redone and he's below the median and what would happen if there is nothing left over to pay the creditors anything? Could the court force his ex to sell?
I'm really annoyed that the attorney didn't warn us about this problem. Apparently they didn't realize DH was on the deed even though I know I told his to them.
Any advice?
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