First-time home buyer

[AJsTax]

I think I know the answer, but want to make sure I am not missing something.
Just got this call and the client is meeting with the mortgage company today!
Client was divorced in Sept. 2008. so is single for 2008. Found out while trying for the loan that she was never listed on the dead of the house they lived in while married, but he never took her off the mortgage as he was told to in the divorce.
Is she considered as having owned the home?
My initial reaction is yes,(which excludes her from the tax credit). it looks at you or your spouse. But she is not married now.
So what do you think?

[Jesse]

My mind is still swirling but I think facts and circumstances would dictate and may not be just that clear cut.

Did she receive property settlement in some way for a portion of the house when they got divorced? What are the state laws, if community property and if paid mortgage, property taxes, upkeep with commingled funds 50% her ownership?

I'm not sure what else to ask so hopefully others will chime in.

[AJsTax]

yEP, ME TOO!

My head hurts too, did so many returns this week!!
We are not community property state. she does not remember what all was in the settlement papers and cannot find her copy...Yes, one of those. I guess she just wanted out and did not care enough at the time. That part is not my problem yet.
I do believe that all funds were comingled and she is entitled to increase in value of the prior home upon divorce.
Just can not find anything that addresses this situation directly.

[JohnH]

Seems to me that if she's really interested in getting these quesitons answered, she would want to file an extension and give both of you time to sort it out.

If she's one of those who's just in a hurry to "get something done", then I'd take the most conservative approach and not worry about the esoteric details. Clients do have some responsibility in this process, and "I can't find the documents" is not a good reason to do anything at this criticial 2-week period, including spending very much of your valuable time thinking about the what if's..

[DTS]

Aj

...We are not community property state. she does not remember what all was in the settlement papers and cannot find her copy...Yes, one of those. I guess she just wanted out and did not care enough at the time. That part is not my problem yet.
I do believe that all funds were comingled and she is entitled to increase in value of the prior home upon divorce.
Just can not find anything that addresses this situation directly.

Don't let her tell you she "does not remember"! You can't tell me that she doesn't remember this or that from a divorce settlement and what she settled for and put into her bank acct? Please..

I'm with John on this.

D

[Jesse]

........... Clients do have some responsibility in this process........

Isn't it amazing how many can't seem to grasp this concept and expect you to put the words in their mouth and come up with the answer - the one they want to hear that is! Do you know what I mean?

[erchess]

Hate to disagree

with DTS but I do. I totally agree with JohnH that clients have the responsibility for getting the facts to us, In fact, I don't understand why the answers to all the tax related questions cannot be obtained by contacting her lawyer or the court. I can however easily imagine a person whose divorce was final in 08 but never paid attention to the details of the divorce and thus knows only the approximate figure that was deposited in their bank account and perhaps not even that if it made up less than a quarter of their total wealth post divorce. (Would that even be possible? In other words if a spouse has much greater personal wealth than the worth of all marital assets, might they still be entitled to half of the marital assets or would they end up making a payment to the other spouse?)

[MariaR08]

I thinkg if she is(was) responsible for the mortgage and she lived in the home (primary residence) - she is not considered a first-time homebuyer for purposes of the first-time homebuyer credit.

[DTS]

Erchess

It's OK to disagree with me. It's rare people don't.

First, I'm not being nasty to AJ. They are trying to do a good job for their client. What I'm saying about this gal is that it sounds like she wants to play stupid with AJ, have him/her pull this credit out from under his/her hat and she hasn't muddied her hands. She knows where the papers are and how much.

Are you telling me that if you owned a home with a wife you would be liable for a mortgage without being on title? Also, if your ex gave you a property settlement, cash or property, that you would not remember the date and how much it was or where you kept those papers? You seem much more thoughtful than that.

D

[thomtax]

It's OK to disagree with me. It's rare people don't.

Are you telling me that if you owned a home with a wife you would be liable for a mortgage without being on title? Also, if your ex gave you a property settlement, cash or property, that you would not remember the date and how much it was or where you kept those papers? You seem much more thoughtful than that.

D

DTS - I will take you up on disagreeing. I will tell you exactly that a person can be on the mortgage without being on the title. My son just went through a nasty divorce. He was never allowed to see the financial dealings of the family. Unfortunately, he is the type that this was fine with him, for several years, because he hates paperwork. However, he found out in the divorce just how devious she was. They supposedly tithed to church, but he found out she was keeping 90% of the tithe in her secret bank account. She tried to force him to have to take the second mortgage in the settlement for a house he had no equity in, even though she did not work and his salary made the payments.

The real topper was that she tried to force him to sign paper that if she decided on another home he had to co-sign the mortgage to help her get it.

So - YES - it happens, if you choose to not pay attention, like he did, against all my advice.

LT

[Jesse]

I think I know the answer, but want to make sure I am not missing something.
Just got this call and the client is meeting with the mortgage company today!
Client was divorced in Sept. 2008. so is single for 2008. Found out while trying for the loan that she was never listed on the dead of the house they lived in while married, but he never took her off the mortgage as he was told to in the divorce.
Is she considered as having owned the home?
My initial reaction is yes,(which excludes her from the tax credit). it looks at you or your spouse. But she is not married now.
So what do you think?

I'll agree that it happens as well, the bank will let you take responsibility for payment even though your name is not on the title.

But AJ's question is getting lost in the thread. I would be interested on other opinions as to whether or not she would be considered having owned a home if her name was not actually on the deed?

[DTS]

I see

LT,

I guess things like that are so black and white for me, never a grey area. I have seen this before with younger people I come in contact with and just shake my head. Hope all's well with your son now and he's learned his lesson?!

Thanks for the disagreement

D

[DTS]

...You seem much more thoughtful than that.

D

Erchess,

I was rereading this thread and saw what I put in at the end of my post. Believe me, this was NOT intended the way it sounds to me now. It was meant as a compliment to you, as all of your posts have a great deal of thought behind them and that was the intent of that comment, but it certainly did not come out that way.

I am so sorry if this troubled you, as it has me now. Believe my intent!

Dennis

[AJsTax]

Believe me,, I understand everyone's' thoughts on this. The person in question is going to the court on Monday to try and find a copy of the final decree. Why not the lawyer ? That I don't know; probably because he would charge for the service and my friends all know that I will answer questions with no strings attached.
I did not spend a lot of time on this other that trying to learn what I can about the issue so that the next time I can answer the question or know where I have the answer saved. Research and learning are my second favorite thing about this work. The first being able to help my friends and clients ( I consider nearly all my clients to be my friends) file a tax return with the minimal amount of stress required.
The kicker of all this, If she cannot take the credit she will most likely file the return she already has done on Turbo-tax. Was worried about getting the credit filled out right.
I do appreciate the one's who take a different look at issues. Sometimes, even tho I try hard not to, I can have tunnel vision on some of these issues.
Everyone have a wonderful and peaceful day. For the first time since early January I am taking the entire day off from preparing taxes... unless someone calls at least.

[Davc]

. They supposedly tithed to church, but he found out she was keeping 90% of the tithe in her secret bank account.

We know where she's going!