Refinancing Home With Friend Leads To Problems
REM #F720
By Ilyce R. Glink
Summary: A reader purchased a home with a friend. After some financial difficulties, the home was refinanced in one name only. Now the reader has the debt in her name, but the title is in both names. Ilyce explains where this reader went wrong.
Q: I purchased a home 8 years ago with a friend. We both put equal money down
on this property.
After a few years, my friend lost her job and I had to refinance the loan under my own credit. To make matters worse, I had to take out a home equity line of credit (HELOC) to continue to make the mortgage payments.
My friend is on the title and she refuses to pay half of the house payments and HELOC payments.
Do I have any recourse as to getting this person off the title to the home? She has refused to issue a quit claim deed to me for her share of the property.
A: Unfortunately, your mistake was to refinance the house into your own name
but leave your friend on the title as an owner. She has full ownership rights
but no financial responsibility to pay off the mortgage. You can't force her
to pay the mortgage because she doesn't have any legal responsibility to pay
it.
She has refused the suggestion that she deed her share of the house over to
you, and truthfully, why should she? She's got the best deal going.
So you're in a pickle. What you should do is sell the property, and use the
proceeds to pay off the loans. Then, you'll have to split whatever cash is left
with your friend.
While it may not be the best time to sell the property, you're better off selling
than being held hostage by your friend – with whom, by the way, you have
no real friendship.
You might also want to talk to an attorney who has experience in partitioning
real estate – meaning suing co-owners to force the sale of the home. The
attorney may have some additional ideas and may be able to force your co-owner
to sell out to you.
NOTE: This column is distributed by Real Estate Matters Syndicate, PO Box 366, Glencoe, Illinois, 60022. This column may not be resold, reprinted, resyndicated or redistributed without written permission from the publisher.
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