Divorce Support Forums: Refiance home loan and modification agreement

The current situation is me and my parents purchased a home that we are currently living in. My parent's used their joint bank accounts and I pitched in with the down payment. I wrote a check to my parents (I have bank records to prove this) and they deposited the check and gave a cashier's check to the lender.

The marriage between my folks has spiraled downward since moving in.

A few years ago we received suspicious forms stating that a modification to the deed of trust must be signed. Reason the lender gave was a deed of trust was not clearly established in the initial purchase. The modification letter read "insert father's name, a married man as his sole and separate property, and insert my name, a single man as joint tenants."

The part that concerned me was the description for my father. I did some research to understand the term "married man as his sole and separate property". I knew this statement was incorrect since my father and mother used a joint bank account to help pay for the house down payment. The only reason why my father's name and my name appear on the home loans is because both of us had the highest credit scores/incomes in the family. My mother can't provide significant proof of income.

I called the lender company and asked who worded the modification to the deed of trust. I insisted that the portion regarding my father needed to be worded differently in order to be accurate. Basically the lender company would put me on hold in the middle of our phone conversations. I had a reason to suspect the person was calling my father and checking to see what they should say to me. It was quite strange that my father was adamant about signing the forms. I held my ground and refused to accept the lender's smoke and mirror answers. Miraculously the situation went away when I sent a formal letter stating my refusal to sign the papers.

Now forward to the present and it's refiance time since our fixed rate is about to expire. I'm reading the loan papers again and it's deja vu. I'm reading the same clause "insert father's name, a married man as his sole and separate property, and insert my name, a single man as joint tenants."

My father has agreed to move out the house and leave it me and mom to live in. The loan will be under my father's and my name like the previous home loan. I would have to pay off the entire second home loan however. So in the end we are just refinancing our jumbo home loan and me paying off the second home loan. A processing fee of $500 will be required with no closing cost/fees for 5 year fixed. The 30 year fixed option will include closing fees/points.

Question I have is should I sign the loan papers despite my disagreement about the sole and separate property? Basically I'm looking out for my mother and don't want her to be screwed should my father to rescind his offer and decides to sell the house and get a divorce.

Also I'm worried about paying for the second loan now and later down the road the house is sold and my father will claim he contributed to the second loan being paid off (of course me and my father have separate bank accounts and I'll be sure to write the cashier's check from my bank account directly to the lender).

I researched that California is community property state. Meaning everything is up for grabs in a marriage/divorce case. However; I'm confused and worried when I read the following link and exception when a deed of trust is defined.

http://www.divorcesupport.com/divorce/California-Property-Division-Factors-440.html

Thanks for reading such a long drawn out story and advice is much appreciated.

EDIT: I don't know what's going on with the formating of my post. I apologize if this may be confusing for some readers.

Edited by divcomplex (05/07/08 04:37 PM)

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