Divorced Borrowers

Fannie Mae – Divorced Obligation on Previous Property: Do I need to count any financial obligation when the applicant is on the deed of a marital property, yet the financial responsibility was assigned to the ex-spouse by the divorce decree? [Includes Divorced Borrower Chart]

Answer: My educated opinion:  The divorce decree is the governing document here, if it indicates that she is not responsible for taxes, insurance and so on for the prior marital residence. Therefore, you should be able to exclude those obligations without any further documentation.  If your lender or underwriter is requiring proof or documentation for [...]

2018-11-25T20:18:01-05:00November 25th, 2018|

Fannie Mae – Divorced Client-Refinance Type: If a borrower is on the title but not on the loan and wants to refinance the property assigned to her in the divorce, is this a rate/term or cash-out? [Divorce Chart]

Answer: Follow the highlighted text below. You should be able to do a limited cash-out refinance on this loan even if she has not been on title. Fannie Mae got rid of their ‘continuity of obligation’ rules a couple years ago. Reference: B2-1.2-02, Limited Cash-Out Refinance Transactions (02/27/2018) Introduction This topic contains information on limited [...]

2018-06-28T16:09:29-05:00March 23rd, 2018|