Tell me more ×
Personal Finance & Money Stack Exchange is a question and answer site for people who want to be financially literate. It's 100% free, no registration required.
up vote 5 down vote favorite

I went through a pretty nasty divorce in which my ex-wife got to keep the house. Eventually the house was foreclosed on and she eventually got evicted. However, my name (along with hers) was still on the 2 mortgages that we had on the house.

Now that the house has been foreclosed, and sold off at the auction, I still see a fairly sizable chunk of each mortgage listed on my credit report as debt.

What can I do about it, if anything.

For reference this is in the state of California.

share|improve this question
there should be a [divorce] tag, and then added to this question – yzorg Sep 20 '10 at 19:19

2 Answers

up vote 3 down vote accepted

California is a non-recourse state, so they won't be coming after you for the balance. If the terms of you divorce were written out that your wife got the house, perhaps a lawyer can get your credit cleared, but that is a long shot.

Your chances depend very much on how long your wife made payments, if there is a provable history and the length of that history might help you out.

http://wiki.answers.com/Q/Which_states_are_non-recourse_states_for_mortgage_debt

share|improve this answer
up vote 7 down vote

Unfortunately, there isn't much you can do. If your name was on the mortgage, you owe the money, regardless of who kept the house. They can (and likely will) come after you for the money as well.

A bit late in your case, but that's why when people divorce, refinancing the house into one person's name (and the other quit-claiming their interest) is usually part of the settlement.

ETA:

As others have mentioned, since you are in California, it appears that they cannot come after you for the difference.

share|improve this answer
Thanks. My understanding of the foreclosure is that I should not owe them any money, since they took the house. Is this incorrect? – Frank Rizzo Aug 12 '10 at 23:01
2  
@Frank Rizzo. I think that depends on if the house sold for more than you owed. – mpenrow Aug 12 '10 at 23:12
1  
@Frank Rizzo: Your mortgage deal was the following: they gave you money, you promised to return money in a number of payments. Suddenly you stopped paying, they sold the house. Now the critical point is whether selling the house raised enough money to pay off all you owed. It might have happened that you bought a severely overvalued house - for example, you took a 2M loan to pay for a house noone wants now so the bank could only sell it for 500K. If at that point you still owed them 1,5M they only got 500K back, so you do owe them 1M. – sharptooth Aug 13 '10 at 9:32
@Frank Rizzo: This is really important. The deal is that you get money and promise to return all the money according to a set plan. The bank's right to sell the house is a backup procedure that lowers (but not completely eliminates) the risk that for whatever reason you just stop paying and the bank can't get money back. – sharptooth Aug 13 '10 at 9:35
2  
The recourse issue for the remaining balance of a mortgage is decided state by state. wiki.answers.com/Q/… – MrChrister♦ Aug 13 '10 at 16:41
show 1 more comment

Your Answer

 
discard

By posting your answer, you agree to the privacy policy and terms of service.