If your mortgage loan states that you’re using your home as a primary residence…?

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Are u allowed to rent if you move out of the house?
Well, the reason I ask is because I contacted my mortgage company on 2 separate occasions and one time someone there told me to ask an attorney regarding renting.

The other time someone else said it was fine.

Both times they didn’t seem too concerned about it.

I have been separated from spouse over 4 years and he has evaded paying all financial obligations and have been uncooperative in the divorce proceeding. I recently gain legal control over joint property. I started re-fi steps and was pre-approved. however, the lending co.just just told me there are 2 liens against the property due to debts he has not paid. Will I be able to complete the re-fi, if the judge remove his name of the loan/ownership?

14 Comments
  1. Reply
    Age of Reason
    February 16, 2011 at 8:38 am

    No that could void your loan and lender can demand payment in full. Most people do not notify mortgage company and just keep paying. Also your home owners insurance policy would be void so you need to buy a commercial policy.

  2. Reply
    wizjp
    February 16, 2011 at 9:08 am

    Most lenders will do an “Assignment of rents and Leases” in the US and permit it; but you must go to them and ask.

  3. Reply
    Janet P
    February 16, 2011 at 10:04 am

    You can, you will need to get the bank to agree. They may require refinancing, depending on the loan for purchase, many do not allow use as investments. They will certainly require proper insurance, as your home owners insurance also requires owner occupancy, one for renters is completely different.

  4. Reply
    Realtoratheart
    February 16, 2011 at 10:32 am

    That is more for Federal taxes. You would just have to declare it on your income taxes, as an investment property. Some people do and some people don’t. You take the risk of being caught and penalized. Mortgage companies don’t care as long as the payment is on time each month. However, IF you are using the tax credit being offered by the federal government, it clearly states that you have to “live” in the property for a period of years.

  5. Reply
    godged
    February 16, 2011 at 11:24 am

    I would need to see it in writing that your lender is OK with it. Bear in mind, you probably spoke to someone earning about fifty cents over minimum wage and was looking for the short answer to get you off the phone.

    What could happen here if you rent it is that the lender will call the note due, you will have 30 days to get a new mortgage, which is going to be at investment property rates (i.e. higher interest rate), and you are going to have to pay thousands in closing costs. Since your loan states you are going to be using this as your primary residence, I would make sure you have something besides a verbal OK from “someone” at the bank covering your butt.

  6. Reply
    golferwhoworks
    February 16, 2011 at 12:08 pm

    read your deed of trust. Any thing you need to know is in the deed of trust

  7. Reply
    loanmasterone
    February 16, 2011 at 12:50 pm

    The majority of lenders could care less about you renting your property as long as you keep the mortgage current.

    You need not get permission from the lender, nor will they call the mortgage loan for you doing this.

    Even if you have a FHA mortgage loan, and your job transfer you to a distant that is too far for you to commute to each day, you may then be approved for another FHA mortgage loan without paying off the existing mortgage loan. You may also rent the other house to a tenant.

    Mortgage lenders have too many other things to worry about as oppose to approving a persons right to rent a place they have purchased.

    Personal circumstances change all the time, there are medical, job transfers taking care of elderly parents, increase in family size and other things that come into consideration, even though you signed your mortgage contract indicating your plans to use this place as your primary residence.

    About the insurance policy you might consider speaking with your agent,but the fact remains that the house is still valued at the same price and by renting the house this price will not change. Insurance is based on the replace value of the property not if a renter or the owner reside in the property.

    I hope this has been of some benefit to you,good luck.

    “FIGHT ON”

  8. Reply
    Jayla
    February 16, 2011 at 1:14 pm

    http://loan-seeker.info/mortgage-loans/ has mortgage requirements, good lenders and mortgage rates, how to get approved for a mortgage, and all other laws and information.

  9. Reply
    BreakingHeart
    February 16, 2011 at 2:10 pm

    It depends on the state that you are living in. I believe the liens still have to be paid off.

  10. Reply
    Kat
    February 16, 2011 at 2:54 pm

    it could take time i would think.. first off if hes suppose to pay those old loans off then i would get my name off them.. but if there still in both names you might not get the loan.. they are getting sticky about things these days and take less and less bad things on ones credit. talk to your loan officer your working with he can tell you what needs to be done. good luck

  11. Reply
    texasm
    February 16, 2011 at 3:17 pm

    My wife agreed that her ex husband would take over their house. They were in the same boat you are in. When he re-fi twice, then subsequently foreclosed, the mortgage company came after her also for the obligation. The mortgage company told her the judge may have removed her name from responsibility, which only meant, she could be forcibly removed if she wouldn’t move out, but the judge did NOT remove her financial obligation to them. They don’t care who pays the mortgage as long as it is getting paid, but if you foreclose, they will hold him equally responsible.

  12. Reply
    Einsteinetta
    February 16, 2011 at 3:56 pm

    No.

  13. Reply
    Dan D
    February 16, 2011 at 4:13 pm

    It depends. Legally, the judge would have to remove the liens from the house.

    If the debts are only his, you would have to prove it in court, then have the judge remove the liens and have them go after your husband (or ex by them I would hope).

    The problem is, when you are married, debt is usually considered as “joint”. So if he owns something you do too. As I said, it will take a judge to do the right job, or some agreement with the places he owns the money but that is kinda almost impossible as they don’t care about your pitiful life (no offense, talking as if I was them), they just want the money back and that’s it.

    So you are stock in this problem because you more likely won’t find a place that can give you a loan if you have a lien on the house, starting with, is illegal to do so unless they approve the loan and take whatever money he owns to pay back the lenders. Either that, or have a judge take the liens away.

    I can tell you one thing, because of the trading market problems and the FED, getting a loan form a bank is almost impossible now. Unless you have a clean record, an almost perfect credit score, and you don’t own no money, you can forget about getting a loan.

    If you need that loan soon, you better hurry up with the legal processes because those take time and you probably won’t be able to get any thing solve for many months from now.

    Good luck.

  14. Reply
    kp
    February 16, 2011 at 4:34 pm

    If you live in the US…

    The judge awarding you the home did not remove his name from the mortgage or the deed. Although actually, I don’t know how the judge did award you the home if the divorce is not yet final. I don’t think that’s possible. Are you sure he/she didn’t just grant you temporary possession of the home pending a final order? That’s a completely different thing.

    In order for you to re-finance he’d have to sign a quitclaim (didn’t your lender mention this, because that’s pretty important) to remove his name from the deed, and it would be very unintelligent of him to do this before you actually refinance. It should be done simultaneously.

    The liens will have to be paid. You cannot refinance a property without paying off ALL the liens. Him signing a quitclaim does not remove the liens.

    However, you can request that the judge order him to pay off the liens (if they do, make sure there’s a stated *date* that he must do this by). The judge may or may not order him to pay off the liens, or the judge may order that you pay half of the liens (if these debts occurred during the marriage, they may be determined to be martial debt and therefore the responsibility of both of you).

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