Home Loan And Deed In Couple's Name, What Happens In Break-up?

Added February 27, 2009 by Ilyce R. Glink

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Summary: If you are engaged and get a first time home buyer loan in both of your names, but call the wedding off, who is responsible for the mortgage? As long as the deed is in both of your names, you are both responsible for the mortgage. Eventually you will have to sell the property or refinance the mortgage in just one person's name.

Q: My daughter was engaged to be married a year ago. She and her fiance got a first time home buyer loan that provided them with a low interest rate if they both signed the agreement.

About two months before the wedding, she postponed it and eventually cancelled it. A month later she moved out and got her own apartment. Three months ago, she and her fiance called it quits.

What can she do now to get her name off the note? She doesn't want any thing from the property and hasn't contributed to any of the payments.

A: Unfortunately, until your daughter's ex-fiance decides to refinance the mortgage (which he probably can't do without her income), she is on the hook for not just 50 percent of the payment, but the whole thing.

If her name is still on the deed, don't remove it. That's her leverage to eventually get her ex to refinance the loan. If he does stop paying the mortgage, she, as an owner of the property, can force the sale so that her ex doesn't completely ruin her credit.

For more information, talk to your tax preparer or real estate attorney.

Jan. 19, 2009.

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