Legal Question in Real Estate Law in Washington
My ex wife got our family home in our divorce several years ago. She was ordered to pay me over $20,000 for my portion of the current equity. I do have a Lien placed on the house for that amount. Since then she has not been able to refi the house in her name in order to pay me. She has not paid the mortgage in almost a year and is currently trying to modify the loan to a more reasonable payment that she can afford. My name is still the primary name on the loan. She has asked me to sign a quit claim deed for the house so she might have a better chance to qualify for the modification. My fear is that the house will go into foreclosure if I don't sign the quit claim deed. Which I believe would clear her of having to pay me out the $20,000+ grand. If she does foreclose it will destroy my credit. Which is more important to me than the money. But if she forecloses later down the road anyway it will still destroy my credit. What is the best route fir me to take? Sign the quit claim deed and potentially put off or avoid her foreclosure? Or not sign it as to keep a paper trail showing that I had interest in the home? Which route would be in my best interest to take? Any advice would help! Thank you.
1 Answer from Attorneys
You should sign the quit claim deed, provided she signs a promissory note for the $20,000, to be recorded in a second position behind the refinanced mortgage. This way, she refinances into her name, which protects your credit, and you still get to keep your lien in the same priority order as it was before. Do yourself a favor and pay an attorney for an hour or two in labor to review everything and make changes as needed.