My property is upside down, and co-signer owes child support. Will they place a lien against him?

How is your property upside down? What do you mean?

I owe more on the loan than what the property is worth.

Jeez, can you buy him out? Especially if you are under water, you should be able to get him off the note.

I can always go for a Quit Deed, assuming he will sign it of course. But its been an ugly battle between he said she said so it may be hard to get that signed.

Maybe you can get a third-party mediator to ask him to sign the quit-deed. Did he contribute to the down payment? Perhaps he will accept his half plus some reasonable amount of interest to grease his palm. It seems to me that if you and he are fighting, and it is your dwelling, and he is making no payments, and he has the potential to be a dead-beat, you would want him the hell off your mortgage, even at some cost.

@dpworkin Wonder what Judge Judy would do in this case? hehe

Wages are garnished for unpaid child support.

Title III, Consumer Credit Protection Act (CCPA)
(15 USC §1671 et seq. (PDF)(http://www.dol.gov/whd/regs/statutes/garn01.pdf); 29 CFR Part 870(http://www.dol.gov/dol/allcfr/ESA/Title_29/Part_870/toc.htm))

Also look at your state law.

If you get a quit claim from your brother ½ the market value of the house will be taxable as income to you. If you actually buy your brother out, whatever you pay him may be garnished.

This is my personal opinion.

She has been making the mortgage payments and the house is under water – no gain, no tax.

@dpworkin I’m not speaking of capital gains tax. (If your comment was a response to my answer)

I don’t think it matters if the debt exceeds the value.

I believe the only time they could place a lien on the property is if he has an ownership share in the property on the deed, not just as a co-signer on the loan. The loan and the ownership of the property are essentially two different things.

You have agreed to give your ownership in the property to the loan company in exchange for the loan, but as far as I know, all he has done is lend his signature promise to pay.

It depends on what the deed says. If he is actually a part owner, then the answer is yes.

@YARNLADY He said he purchased the house with his brother.

@perspicacious There are many different ways to purchase a house, including one person agrees to help pay or it, but is not mentioned on the deed, and therefore has no ownership interest to put a lien on.

Even though they may place a lien against the property this does not mean they can or will force a sell of the property. The lien is placed against the property that your brother has a recorded interest in to prevent the person from selling or refinancing without having first paid the child support debt in full. Not to take the home away.

The problem is that you are not going to be able to remove him from the deed or to refinance the property unless and until he pays his debt.

Which means this problem will never go away for you. And it also means that despite you having made all the payments, the judgment/lien for back child support will be paid first before anything else when and if you do sell or refinance.

Yes, they will seek to garnish his wages but they may also file a lien against this property concurrently.

@YARNLADY We can only assume the brother is on the deed since the poster mentions getting a quit claim deed from him.

@perspicacious For an accurate answer in real estate it is better not to assume anything

@YARNLADY It he needs a deed from his brother, it’s a safe presumption that the property is deeded to both brothers.

Thanks for everyones answers.

Yes, my brother is on the deed to the house, as well as the loan itself. It seems the best way to go is to try my best to get the Quit claim deed prior to anything such as lien being placed against him/the property.

I wish you the best of luck.

@wgallios – The problem with the quit claim deed is that while it will take him off the deed of the property it will do nothing to remove him from the loan. The lender is not going to allow you to do this without you refinancing or re-qualifying for the loan under your own steam( without him as a cosigner).

And if you look in the very tiny print on your deed of trust you will likely see a clause that states that if you were to transfer the property out of the original borrowers names (you and him) without their approval that you may activate a “pay in full” demand from the lender.

You can’t protect the property from his failure to pay his child support unless you are in a position to refinance or assume the loan entirely on your own credit without him cosigning and removing him entirely from the whole thing.

I agree with @Merriment

@Merriment That is a good point, I guess I should probably talk to my lender prior to doing any of this; I wouldn’t want to have “pay in full” as that would not be a good situation.

@wgallios – Talking to your lender first is definitely the course I would advise. Not many of us are in a position to pay up in full at a moments notice. Good luck.