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#1641058 - 12/20/11 05:07 PM Divorce - refi and purchase
AuditorK Offline
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Joined: Feb 2003
Posts: 961
We are doing a loan for a husband, who is buying out the wife's share of what used to be their joint home (pursuant to a divorce). The loan is a refinance (paying off the husband's/wife's old mortgage and new loan is secured by a mortgage on now solely the husband's home. Is this also a purchase for the husband since he is buying the wife's share and now the sole owner of the home? How should this be reported?

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#1641282 - 12/20/11 08:27 PM Re: Divorce - refi and purchase AuditorK
Truffle Royale Offline

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Joined: Jul 2003
Posts: 17,285
There are two schools of thought on this, both well documented through out this forum that you can read if you search using 'divorce'

I'm on the side of refinance. The borrower already is an owner.
Others call it a purchase.
Pick one and stick to it for every similar circumstance.

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#1641317 - 12/20/11 09:11 PM Re: Divorce - refi and purchase AuditorK
RaesPlace Offline
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Joined: Mar 2011
Posts: 230
I'm from the school that codes these as a purchase, as one person is purchasing the other's interest in the property. As Truffle stated, pick a side, put it in your procedures and be consistent.

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