Anyone had any success with a quit claim deed to buy a new house?

[Stilltheone]

I've been reading up on this and wondering if anyone else had success with this? I know sweetpea did it but I would love to hear other stories.

I'm contemplating using the quit claim deed to remove my husband off of this house and I would love to buy another one eventually. (would love to skip renting with 3 kids and one on the way) Our mortgage was included in our '08 bankruptcy and does not report on our credit report.

Thanks for any help!

[despritfreya]

What do you mean by "removing your husband off of the house". If he wishes to get off the title then he has to issue the quit claim deed for his interest in the home to you.

Exactly what are you trying to accomplish by having your husband sign off on a quit claim deed?

Des.

[justbroke]

I have the same question... how do you QC someone other than yourself? You can only QC your own interest in a property. Unless you have some sort of durable power of attorney???

[Stilltheone]

Yes, my husband would file the quit claim deed with our county so it's just me on the deed. Then, he could go purchase a house in just his name since the current house would just be in my name.

[despritfreya]

Yes, my husband would file the quit claim deed with our county so it's just me on the deed. Then, he could go purchase a house in just his name since the current house would just be in my name.

Does this actually work? I realize that the debt was discharged in the bk but the loss of the home to a foreclosure could be reported for both of you as you were both on the loans????? Don't know but am curious.

Des.

[justbroke]

A foreclosure would affect the credit of those that are on the Mortgage/Promissory Note. I'm assuming that you are now current. The creditor may ask some questions if they see the QC and/or they ask if married. I don't know how it would work.

Also, I would ask if the mortgage appears on ANY credit bureau. There are 3 (major) credit bureaus and mortgages report to all 3. The new bank will always check all 3 of these bureaus. If they see the mortgage, they may ask what happened to it... especially if it doesn't read "Paid" with a $0 balance. (What I'm saying is that if it says "Included in Bankruptcy" then that may cause questions.)

[Stilltheone]

The mortgage is listed on my husbands credit as included in bankruptcy and as having a zero balance for both first and second. The last few times we've applied for car loans/credit cards, we get asked if we have mortgage because they don't see it on our credit report. We are about 60 days behind right now. We always make a payment every 30 days but just can't catch up.

My husband had been planning on telling the bank, if asked about our first house, that it was included in bankruptcy....which is the absolute truth.

[Stilltheone]

Also, would they actually report the foreclosure on our credit report? I thought once the debt was discharged in bankruptcy, they no longer report on the debt. We actually had our SUV repossessed about 2 years after the BK (we signed a reaffirmation agreement on it) and that's nowhere on our credit report.

[Stilltheone]

Also, I was NOT on the loans for the house. I was put on the deed, but because I didn't work at the time of the loans, the bank didn't put me on.

[justbroke]

Okay, let's look at it this way. The bank will certainly pre-approve you for a mortgage, especially if you apply on-line since they only look at the score (and income somewhat). The problem area is when it goes to underwriting. The underwriter will check to see the status of the IIB property. This may lead to some questions that may cause issues.

I don't know if you are aware that the underwriting guidelines for government-backed loans typically require that you haven't filed bankruptcy within 2 years AND haven't had a foreclosure within 3 years. The underwriting portion is where you may run into trouble. Lenders don't like to see that you are not paying your debt after being discharged from bankruptcy. That's why they have the wait period. (Even if it's not being reported, the status of the IIB property can come into underwriting scrutiny.)

The not so fun thing to tell you is, that if you had just let that house go in 2008, or had made all your payments on time over the last 2 years, it may be easy to get a mortgage if you are otherwise credit qualified.

[Stilltheone]

Why would it matter if we had made on time payments on the mortgage within the last 2 years? None of that is being reported on our credit report. If underwriting does a title search in my husbands name, nothing will come up.

[justbroke]

I'm just saying it depends on if they ask. At that point, it does matter, even if it is not reported! Underwriting always want to know how you have made payments on all credit. The question isn't if it comes up in a title search, which underwriting doesn't do, it will be if they see the telltale signs of an un-reaffirmed mortgaged. They will ask what happened to the home.

Or, the underwriter may not even bother. I can't tell you that. However, that is where you would get caught up.

[Stilltheone]

Thanks for all of your help, justbroke! I know this isn't something that a ton of people do and I got the idea from reading about member sweetpea when she did it. I wouldn't even mind letting my house go and renting for awhile if I didn't have 3 kids with one on the way. I would really like to just purchase another house. Thanks again!

[justbroke]

I remember sweetpea. Yes, she was doing something similar. Just let us know what happens should you decide to do this. I was just giving you a preview of what you "may" run into when it comes to underwriting.

I recently applied for a vehicle loan. My mortgages are all IIB and have not reported since 2008. The lender still asked the status of the properties! A title check clearly would have shown that one of them was actually returned to the lender. I guess this is just their due diligence.

[Stilltheone]

Not quite sure if we will or not. I don't like the uncertainty of it all, especially with kids. When we applied for a vehicle loan, they asked if we had a mortgage, but didn't ask for proof. We were honest and said it was IIB, but we were choosing to pay it.