I’m buying a new house and the lender wants proof that I don’t have any financial interest in a property that was discharged in a Chapter 7 bankruptcy seven years ago. My ex-wife still lives there with my daughter and handles all the payments. This was a verbal agreement we made during our divorce. The mortgage statement says ‘voluntary’—is that enough proof, or do I just need to write a letter saying I have no financial interest? The house is underwater, and my ex plans to move out in six months, so the lender will likely take it with no recourse to either of us. Any advice?
Why wouldn’t your ex try selling the house instead of giving it to the bank?
Nash said:
Why wouldn’t your ex try selling the house instead of giving it to the bank?
She had some financial issues that led to the bankruptcy. Our lawyer suggested including the house because it was so far underwater, and we didn’t plan on staying long-term. Now, it’s still underwater with no financial gain to be made.
You need to talk to your lender about this. If your name is still on the house, it could be an issue.