February 19, 2014
A reader asks, “Currently, my husband and I have a FHA loan on our primary residence. We are no longer living together, but still married. I have lived in the home for the last 5 years and paid the first mortgage which is current, never late. My husband inquired a second mortgage on the property in 2006 but is not current on the payments of the second mortgage.”
“The second mortgage is in his name only. He filed bankruptcy in 2009 which has been discharged. He did not reaffirm debt of the first mortgage, but he reaffirmed the second mortgage. Can his name be removed from the FHA loan, especially since he is no longer obligated to pay the first mortgage by not reaffirming the debt during his Chapter 7 bankruptcy filing?”
FHA loan rules aren’t necessarily the guidelines that would apply in this situation–state laws, especially those that govern the disposition of common debts and property in a marriage–would apply.
We aren’t qualified to give legal advice in cases like these, so the reader would need to consult with a lawyer or a legal expert who has experience dealing with state marriage laws that may apply.
Since state laws vary quite a bit, it’s impossible for the FHA to have a blanket policy on such things, and even if there was an FHA loan rule that might pertain, it would not and could not override state marriage laws or other regulations where applicable. One reason for this is that some states have “community property laws” which basically make the financial obligations formed during the marriage a matter of shared responsibility between both spouses.
But not all states have such laws, so the reader will need to determine what might required under the law in the state where the home purchased with the FHA loan is located.
Borrowers with questions about the disposition of an FHA loan during or after a divorce, legal separation or other action will need to discuss the issue with the lender and a lawyer where necessary.
Do you have questions about FHA home loans? Ask us in the comments section. You can apply or get pre-approved for an FHA loan at FHA.com, a private company and not a government website.
Joe Wallace has been specializing in military and personal finance topics since 1995. His work has appeared on Air Force Television News, The Pentagon Channel, ABC and a variety of print and online publications. He is a 13-year Air Force veteran and a member of the Air Force Public Affairs Alumni Association. He was Managing editor for www.valoans.com for (8) years and is currently the Associate Editor for FHANewsblog.com.
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