A mortgage is a lien on a property holding all parties named on the mortgage financially responsible for repayment of the liability. Typically, the same individuals listed on a mortgage are listed on a deed to the property as well. Having a name removed from a mortgage can be a difficult process if you are not sure what to ask for, or what steps need to be implemented in order to remove someone from a mortgage lien.
The mortgage on a property is tied directly to the deed. The deed defines property ownership interests. In the case of a marriage, property ownership interests are divided on a 50/50 basis. This means that both parties are equally responsible for the property upkeep and maintenance as well as the mortgage payments.
In specific cases where a co-borrower on a mortgage is not an occupant to the property, the deed will reflect this information. This is a typical scenario for homeowners that have a mother, father, or other family member co-sign a mortgage for them. However, even if someone on the deed is not occupying the property she is still responsible for payment of the mortgage in the event that the occupying person defaults or abandons the property.
In many cases of a non-occupying co-borrower, after a successful payment history of at least two years, the primary homeowner can contact the lender and asked that the non-occupying co-borrower be removed from the mortgage. This is typically a simple process, requiring only a few signatures from a homeowner and getting the sign off permission of the co-borrower. Removing someone from a mortgage after the dissolution from a marriage changes the process.
Divorce decrees often include property settlements. To avoid property disputes in most states, one spouse is granted ownership interest at a level of 100% in the property. However, not all divorce decrees will entail a quitclaim deed filed with the court system, which is a requirement to remove a spouse off a mortgage.
In many cases where a divorce is the reason behind removing one party from the mortgage lien, a refinance is required. This is particularly to show that the occupant to the property has the means and ability to pay the existing mortgage without a co-borrower or spouse on the loan. Refinance requirements will vary from one type of loan to another and your lender will be specific about the requirements needed to refinance your home.
The period that it takes to remove someone from a mortgage can be as little as seven days or as long as forty-five days, depending on the circumstances surrounding the removal. The faster that paperwork is returned to the lender and subsequently filed with the court system is the faster that the situation can be put behind you.