Looking for some creative financing idea from the experts!

[Brittani Gardner]

Looking for some solid ideas for a win-win situation.  

In 2012 I bought my first home while engaged. We paid market value and did some minor work (diy kitchen reno, converted bedroom to formal dining, new flooring in partially finished basement, landscaping). 1 year later we split up and I still reside in the house. We are co-owner and co-financed. Now we are looking for ways to separate financially but I am not sure I want to give the house up. 

Details:

FHA appraisal (2012): 165,000

ARV in 2012 was: 180,000

Comps are hard to come by and the values have slightly declined since I've been here (now comps are: 160,000-170,000)

Loan balance: 153,000

PITI: 1135

Rent Comps: 1300-1400

I dont think I would have a problem with renting or lease option this property at all. The problem is needing to remove my "ex" from the situation. I could buy him out for under $5K, but I know he wont sign over the deed until the mortgage paid in full and I really don't want to go refinance in my name just to get around this because I want to avoid all unnecessary costs.

Can anyone advise on a wraparound mortgage in this situation to free up my ex to go buy another house? Will it work considering I am on the original loan also? I would really, really reall like to leave the existing financing in place as it is a great rate and an FHA loan that wont carry the PMI forever like the new ones.

Please anyone and everyone...Help a girl out!

Sub-2, subject 2, wraparound, creative financing, lease option, contract for deed, existing financing

[Dion DePaoli]

Brian Gibbons - this bad advice.

You are not SELLING....who the heck are you Selling too? You are already on title.

 Stop the madness.  It boggles my mind sometimes when we look to the extraordinary before the ordinary.  

All you want to do is remove the ex from title and the mortgage.  It's really that simple.

REFINANCE - $153K / $170K = 90% LTV - you are in the church. Closing costs are not as high as a purchase. It's a rate and term refinance. Maybe you contribute a couple grand to the closing based on appraisal. Some lenders will pay for closing cost to do a streamline refinance. That is why I mentioned deal with the loan first before the ex, so you both understand the transactions capital demands.

Folks split up all the time.  It's not new in the Mortgage world.  Chances are, they will let you assume the liability all by yourself.  It will cost you a fee (+/- 1%) to get looked at and underwritten, far less expensive than a refinance.  

Priority Rank:
1) Assume (Mod) / Quit - Ex
2) Refinance

The OP doesn't understand what she is doing with a Wrap.  A Wrap should not even be on the radar here.  A Wrap will not remove the underlying mortgage nor will it remove the Ex as a Borrower.  So, you get nowhere.  Its a HORRIBLE idea. 

Most important: IF YOU WRAP A FHA LOAN THERE WILL CAN BE SERVER CONSEQUENCES. There is a whole thread on this under Creative Strategies - Wrap FHA Mortgage - go read it.

Further, if you amend the occupancy of the property to NOO by putting tenants in or renting or messing with the silly Wrap idea, you will screw up any future deal. You want the occupancy to stay Owner Occupied, that affords you the best loan term review.

This is not creative financing.  This is being silly and trying to make stuff up that is not fully understood.  All the while, the easy and every day solution is slapping you in the face.

....but what do I know.

Rant over.