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My spouse and I are divorcing. I%26#39;m hoping to remain in our house after
giving her half the equity in the house.
Our house is located in Rutherford Cty, TN and is ~10 years old. It%26#39;s
estimated
market value is ~$130-$140,000 (we are awaiting the results of an
appraisal).
My primary reason for wanting to remain in the house is to maintain a
sense of continuity for my 10 yo son.
We have ~ $81,000. in equity. My annual net income is ~$31,200. We
have some savings but I feel this will be depleted by the divorce
process.
I need to know if I would be able to afford the house after
re-financing to provide my spouse with half the equity. Are their any
creative financing methods that might help? Any additional
suggestions?
%26lt;Since you already have a lender it would be worth trying negotiate a
deal for refinancing with them. By finding the best quote possible
with an alternative lender you can present your current lender with
this quote and threaten to take away your business unless they give
you a better deal. Most lenders will give you a better deal in order
to keep your business. Even a cut of a fraction of a per cent can save
you thousands of dollars over the life of your mortgage.
Mortgage quote.
Based on the highest price for your house of $140,000 and deducting
your share of the equity at $40,500, you will need a mortgage for
$99,500.
The following quote was found via interest.com.
A 30 year mortgage at 5.75% with Peach State Mortgage costs $580.
U.S. Department of Housing and Urban Development.
HUD has a number of programs to help people buy or refinance their
house. Links to the programs are given below. The FHA mortgage
insurance program helps by lowering the costs of loans. It also
encourages lenders to make loans by protecting the lender against loan
default.
Local programs.
Murfreesboro/Rutherford County has an affordable housing assistance
program. There are no details given online but the link below leads to
contact details.
Co-ownership.
An option that has often been used in the UK where property prices are
extremely high is co-ownership. It involves finding another person to
share the house with you. You share the mortgage payment and each owns
a portion of the house. A legal agreement needs to be drawn up
covering all the conditions, usually in the form of a trust. This
means that there are additional legal fees. The obvious disadvantage
is that you have to share the house with someone else which involves
all the usual problems of co-habiting. However it can be a solution to
temporary financial problems. The ideal co-owner would be someone
young who is looking for a way to get on the property ladder with the
intention of moving on after a few years. It allows you time to
improve your finances so that you are in a better position to take
over the entire mortgage. The link below to %26#145;The ultimate house mates%26#146;
describes this method.
THDA
You satisfy the earning conditions for the THDA%26#146;s homeownership
program but the value of your house is too high. They generally
provide loans to first time buyers but there exceptions if your house
is in a particular area. Rutherford county doesn%26#146;t qualify. This
program may be useful if you decide to sell and move to another area.
%26lt;Additional links:%26gt;
%26lt;Online mortgage quote.%26gt;
%26lt;http://www.interest.com/tennessee/%26gt;
%26lt;The ultimate house mates.%26gt;
%26lt;http://www.ivenus.com/finance/features/CP-Feature-buy_house_w_friends-wk58.asp%26gt;
%26lt;Peach State Mortgage%26gt;
%26lt;http://www.peachstatemortgage.com/%26gt;
%26lt;Mortgage and financial calculators.%26gt;
%26lt;http://www.interest.com/hugh/calc/%26gt;
%26lt;HUD%26#146;s Mortgage Insurance Programs%26gt;
%26lt;http://www.hud.gov/buying/insured.cfm%26gt;
%26lt;Single family housing programs.%26gt;
%26lt;http://www.hud.gov/funds/singlefamily.cfm%26gt;
%26lt;FHA mortgage insurance program%26gt;
%26lt;http://www.hud.gov/progdesc/203b--df.cfm%26gt;
%26lt;Rutherford County %26#150; housing program.%26gt;
%26lt;http://www.hud.gov/local/tn/buying/buyingprgmslocal.cfm#mu%26gt;
%26lt;THDA%26gt;
%26lt;http://www.state.tn.us/thda/Programs/Mortgage/hmownshp.html%26gt;
%26lt;Search strategy:%26gt;
%26lt;buying a house%26quot; alternative to mortgage%26gt;
%26lt;://www.google.com/search?hl=en%26amp;lr=%26amp;ie=ISO-8859-1%26amp;q=%22buying+a+house%22%26amp;as_q=alternative+to+mortgage%26gt;
%26lt;Mortgage calculator%26gt;
%26lt;://www.google.com/search?as_q=%26amp;num=10%26amp;hl=en%26amp;ie=ISO-8859-1%26amp;btnG=Google+Search%26amp;as_epq=mortgage+calculator%26amp;as_oq=%26amp;as_eq=uk%26amp;lr=%26amp;as_ft=i%26amp;as_filetype=%26amp;as_qdr=all%26amp;as_occt=any%26amp;as_dt=i%26amp;as_sitesearch=%26amp;safe=images%26gt;
%26lt;Hope this helps.%26gt;
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