by bholder99 » Sun Oct 24, 2010 05:30 am
I recently married. I have a home that is paid off - only my name is on the title with a will in place leaving it to my children (My husband and I have a pre-nup.) We own a vacation home with rights of survivorship. Each of us has a life insurance policy with more than enough to pay off the existing mortgage should something happen. We are listed as single beneficiaries on these policies.
Ok, now it gets tricky. My husband is still on the ex's house title/mortgage. Per the divorce settlement, she had two years to sell the house. It has not sold and it is now going on 4 years. My husband pays the mortgage out of the child support amount he is, by law, to pay. The child support amount is $1000 and the mortgage is $800. So, he pays the mortgage and the ex gets a check for $200. She is (voluntarily) unemployed so cannot refinance the house. Her boyfriend has moved into the house and we assume he assists with other bills.
My concern and questions are threefold:
1) What happens if my husband dies? If my husband dies, I would not want the life insurance I am listed as beneficiary be taken to pay this debt that his name is on. Nor would I want to be held responsible for the debt in his name.
2) If the ex dies, I don't want to be responsible for a third house (that may or may not sell.) We could not afford this.
3) What happens in three years when my step-daughter turns 18? Now, the $1000 child support stops and my husband is still on the mortgage but now the ex has no income (she has no desire to work.)
My husband is being a nice guy. He does not want to force the ex to sell the house in that would probably cause his daughter to have to change schools. While I commend him for being such a nice guy, I don't want to be taken advantage of - or be held responsible for a mortgage if something were to happen. Any advice would be greatly appreciated.
Ok, now it gets tricky. My husband is still on the ex's house title/mortgage. Per the divorce settlement, she had two years to sell the house. It has not sold and it is now going on 4 years. My husband pays the mortgage out of the child support amount he is, by law, to pay. The child support amount is $1000 and the mortgage is $800. So, he pays the mortgage and the ex gets a check for $200. She is (voluntarily) unemployed so cannot refinance the house. Her boyfriend has moved into the house and we assume he assists with other bills.
My concern and questions are threefold:
1) What happens if my husband dies? If my husband dies, I would not want the life insurance I am listed as beneficiary be taken to pay this debt that his name is on. Nor would I want to be held responsible for the debt in his name.
2) If the ex dies, I don't want to be responsible for a third house (that may or may not sell.) We could not afford this.
3) What happens in three years when my step-daughter turns 18? Now, the $1000 child support stops and my husband is still on the mortgage but now the ex has no income (she has no desire to work.)
My husband is being a nice guy. He does not want to force the ex to sell the house in that would probably cause his daughter to have to change schools. While I commend him for being such a nice guy, I don't want to be taken advantage of - or be held responsible for a mortgage if something were to happen. Any advice would be greatly appreciated.
Posted: Sun Oct 24, 2010 07:54 pm Post Subject:
A couple of things to explore here.
Per the divorce settlement, she had two years to sell the house. It has not sold and it is now going on 4 years.
If this is the case, why has your husband not gone back to court to be released from the obligation to pay? Get a court order to allow him to "Quit Claim" the property to his ex-wife and be somewhat relieved of any responsibility to the property. Or get an order for her to vacate the property so he can sell it.
What happens if my husband dies? If my husband dies, I would not want the life insurance I am listed as beneficiary be taken to pay this debt
If you are the named beneficiary of your husband's policy, that will not happen (this is one instance where it might be best if you were the owner of his policy and he were the owner of yours -- so that you are in control of who the beneficiary of his insurance is, and vice versa). But how can you be sure he has not changed the beneficiary to someone else (like his ex-wife or his daughter) without your knowledge? That's why you having the ownership of his policy makes more sense -- you would probably not do that to yourself, would you?
If the ex dies, I don't want to be responsible for a third house
That won't happen either if your name is not on title. Title to the property most likely is "Joint Tenants" and if your husband dies, his interest automatically passes to the surviving joint tenant(s). On the other hand, it would be your husband's "problem" if she dies (under the same Joint Tenancy scenario). Since you and your husband are "in this [new marriage] together", indirectly it would have its effect on you.
What happens in three years when my step-daughter turns 18? Now, the $1000 child support stops and my husband is still on the mortgage
If the alimony/child support ends, then he stops paying, and it's only a matter of time before she loses the property. The worst case scenario at that point is if she files for bankruptcy. Being on title, your husband might be forced into filing a bankruptcy petition of his own in order to protect himself from being inadvertently obligated to any claims discharged against his ex. And YOU could also be forced into a bankruptcy filing to protect yourself against any claims discharged against your husband that a creditor thinks they could pursue against you. A big mess, right?
So let's return to my original question. Why is your husband being so nice to his ex? Just to make things less traumatic for his daughter? He needs to go back to court and petition to be relieved of his obligation on the mortgage so the sword hanging over your heads is removed.
Divorce is not often a clean solution to troubled/failed marriages. And situations such as the one in which your husband is mired can only get worse if allowed to persist (nice guy that he is, he's four years into what was supposed to be a two year situation -- and the court may wonder why he didn't come back for relief sooner, too).
The life insurance is essentially safe, but your savings could be at risk. None of us here are lawyers (or at least admit to it). Get some good, professional legal advice on how to do this the right way in the jurisdiction(s) involved.
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