StandingO Posted March 31, 2015 Share Posted March 31, 2015 A friend of mine is separated but only a verbal understanding and no separation agreement in place. Their mortgage is up for renewal now. They only have a small portion (under 30K) to pay off. She wants to sell and get paid her half or use their LOC to finish the mortgage until it sells. He wants to lock into a 3 year fixed. She fears it will be 3 years before she gets paid her half. He rather take a chance on saving the marriage or rather she thinks is not willing to part with half the house value at this time. I suppose they could sell even with the fix but it would be on trust with himagreeing to selling in the near future. Is she better off to use her LOC to save penalties and to have the freedom to sell now. I think so or at least sign a separation agreement first. Anyone with experience in this stuff? Link to post Share on other sites
Mr. Lucky Posted April 1, 2015 Share Posted April 1, 2015 Does the verbal understanding only cover the distribution of proceeds or does it involve the mortgage also? In other words, is her name on the deed? Mr. Lucky Link to post Share on other sites
kenmore Posted April 1, 2015 Share Posted April 1, 2015 First of all, a verbal separation agreement means absolutely nothing, so pretend it does not exist. Second, why is a mortgage "up for renewal"? They run until they are paid off (or abandoned). Third, they owe less than 30K and he wants a 3 year loan? I guess things are different up there. That's a little crazy because they should be well into paying the principal now, and taking out a new mortgage will incur a whole new interest payment period. Anyway, since there is no separation nor divorce, they are equals in the relationship and he is under no obligation to sell. If he gets a 3 year mortgage (never even heard of such a thing!), it will be a Hell of a lot longer than that before she gets her half. It won't be until he has the money to buy her out. Now if she files for divorce (a separation won't do it I'm pretty sure) and demands her half as part of the settlement, he will either have to come up with it himself or sell the house and pay her...eventually. I guess another question is how are they communicating? Are they on decent terms or catfights? Is this a battle not based on wanting the house or money, but rather on causing strife? Is it turning ugly? Finally, if things are really different up there, then maybe I have no idea what I'm talking about. Ken Link to post Share on other sites
dreamingoftigers Posted April 1, 2015 Share Posted April 1, 2015 You are in my city. And I work for a realtor I'll ask him about it tomorrow and post back to you. We just had a really interesting case regarding a separation actually. And yes, as far as real estate Law goes, there is NO SUCH THING as a verbal agreement. So their separation legally won't stand up as anything. Nothing at all. If both of them have stayed in that house for one night, then they need consent of both to sell, unless a court order grants one the house. Well, they can technically "sell" but the possession date won't be until after the death of the party that did not consent. LOL. I can't imagine how many people have screwed each other around divorcing because of that. Link to post Share on other sites
dreamingoftigers Posted April 1, 2015 Share Posted April 1, 2015 First of all, a verbal separation agreement means absolutely nothing, so pretend it does not exist. Second, why is a mortgage "up for renewal"? They run until they are paid off (or abandoned). Third, they owe less than 30K and he wants a 3 year loan? I guess things are different up there. That's a little crazy because they should be well into paying the principal now, and taking out a new mortgage will incur a whole new interest payment period. Anyway, since there is no separation nor divorce, they are equals in the relationship and he is under no obligation to sell. If he gets a 3 year mortgage (never even heard of such a thing!), it will be a Hell of a lot longer than that before she gets her half. It won't be until he has the money to buy her out. Now if she files for divorce (a separation won't do it I'm pretty sure) and demands her half as part of the settlement, he will either have to come up with it himself or sell the house and pay her...eventually. I guess another question is how are they communicating? Are they on decent terms or catfights? Is this a battle not based on wanting the house or money, but rather on causing strife? Is it turning ugly? Finally, if things are really different up there, then maybe I have no idea what I'm talking about. Ken Canadian vs. American Land Ownership is a completely different system. The American system is much more complicated and a real PITA for realtors. Link to post Share on other sites
dreamingoftigers Posted April 1, 2015 Share Posted April 1, 2015 A friend of mine is separated but only a verbal understanding and no separation agreement in place. Their mortgage is up for renewal now. They only have a small portion (under 30K) to pay off. She wants to sell and get paid her half or use their LOC to finish the mortgage until it sells. He wants to lock into a 3 year fixed. She fears it will be 3 years before she gets paid her half. He rather take a chance on saving the marriage or rather she thinks is not willing to part with half the house value at this time. I suppose they could sell even with the fix but it would be on trust with himagreeing to selling in the near future. Is she better off to use her LOC to save penalties and to have the freedom to sell now. I think so or at least sign a separation agreement first. Anyone with experience in this stuff? In Calgary, the value can rise and fall depending on the area the home is in too. Arg. I don't think you have PM privileges, I would send you some info. What area is the home in? Link to post Share on other sites
PegNosePete Posted April 1, 2015 Share Posted April 1, 2015 A verbal agreement isn't worth the paper it's written on. Get it signed and sealed by the court before doing anything. Get it frozen until then, so he can't do anything with it like locking it away for 3 years. Link to post Share on other sites
Author StandingO Posted April 1, 2015 Author Share Posted April 1, 2015 Hillhurst area. It would be a 3 year term I was told. They would have it paid off at the end of that term as only 30K remaining in total mortgage. Instead she wants to use the LOC so she is not stuck in a 3 year locked term. She want him to buy her out or sell. Her worry is he will just complete the term and not sell so she feels that she that a better chance to get her half now having the mortgage paid off now (with LOC). She wants a separation agreement sign regardless but certainly if he gets his way with the 3 year term. Link to post Share on other sites
kenmore Posted April 1, 2015 Share Posted April 1, 2015 A verbal agreement isn't worth the paper it's written on. Get it signed and sealed by the court before doing anything. Get it frozen until then, so he can't do anything with it like locking it away for 3 years. The legal separation will do that, it will freeze things. Again, speaking from U.S. law. Since you say she wants to cash out now, this would be counter-productive. Most likely, a divorce would be the only way to force that...or death. Now don't go giving her any ideas! Ken Link to post Share on other sites
PegNosePete Posted April 2, 2015 Share Posted April 2, 2015 The legal separation will do that, it will freeze things Yes, but that may be months away, by which time it may be too late. I would get the accounts frozen by the bank while the legal separation is being progressed. Link to post Share on other sites
kenmore Posted April 3, 2015 Share Posted April 3, 2015 Then again, if the place burnt to the ground.... There I go again! :-) Link to post Share on other sites
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