Wednesday, August 29, 2007

query: does a non-borrowing spouse have to come off title on a FHA deal

Apparently. It stinks, doesn't it? I am hoping the FHA might come up with a new rule on this issue while they are rewriting programs in response to the subprime refinance wave.


Mac said... you deed them back on after closing.

Diane Cipa, The Closing Specialists® said...

No. You can't do that without the lender's permission. The mortgage contains a "due on sale" clause.

Brendan said...

I recently encountered a transaction where the lender (in a non-FHA mortgage) required a non-borrowing spouse to be added to the title, thus eliminating the refinance discount (since, in New York, the current owner must be identical to the original borrower in order to get the refi discount). The borrower was a business acquaintance who owns several rental properties, and was refinancing them with two different lenders. One of the lenders required him the sign a deed to himself and his non-borrowing spouse in order to get the mortgage.