Will a mortgage lender accept a notarized separation agreement for a loan assumption?

Get Legal Help Today

 Secured with SHA-256 Encryption

Will a mortgage lender accept a notarized separation agreement for a loan assumption?

I am divorcing and keeping the house by assuming the loan. The separation

agreement has been drawn up by both parties and agreed to. Is there further a process to have it be recognized as a legal separation or will it be recognized if it is signed in front of a lawyer by both parties?

Asked on December 30, 2016 under Real Estate Law, North Carolina

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 4 years ago | Contributor

It's up to the lender what to accept--and whether to allow assumption at all. While you should check the mortgage agreement itself to be sure, the vast majority of mortgages have "no assumption" or "no assignment" clauses--that is, there is no right to assume a loan, and it can only be done with lender consent, which consent must be voluntarily given--i.e. it can be withheld for any reason. So it's up to the lender whether to allow you to assume the mortgage and, if so, what is required to do that. Bear in mind that your separation or divorce agreement has NO bearing on the lender: the lender is not part of your marriage, is not a party to your divorce, and is in no way bound or affected by the separation agreement between you and your soon to be ex-spouse. So they can ignore the agreement and not allow the assumption if they choose. You may have to instead refinance in your name alone.


IMPORTANT NOTICE: The Answer(s) provided above are for general information only. The attorney providing the answer was not serving as the attorney for the person submitting the question or in any attorney-client relationship with such person. Laws may vary from state to state, and sometimes change. Tiny variations in the facts, or a fact not set forth in a question, often can change a legal outcome or an attorney's conclusion. Although AttorneyPages.com has verified the attorney was admitted to practice law in at least one jurisdiction, he or she may not be authorized to practice law in the jurisdiction referred to in the question, nor is he or she necessarily experienced in the area of the law involved. Unlike the information in the Answer(s) above, upon which you should NOT rely, for personal advice you can rely upon we suggest you retain an attorney to represent you.

Get Legal Help Today

Find the right lawyer for your legal issue.

 Secured with SHA-256 Encryption