Unilateral Opt Out: When Co-Owners Unwillingly Rescind or Default
Co-Owners Unwillingly Rescind / Default
1. Homeowner A 🙂 + Homeowner B 😢are co-borrowers on the mortgage. Homeowner B 😢defaults.
2. Chersurance: Homeowner A 🙂is notified by Cher.
3. Funds from Homeowner A 🙂in the Cher Impound Account are used to pay the missing amount. Credit card is used first from Homeowner B 😢.
4. If credit card for Homeowner B 😢is maxed out, the Cher Impound account is used from Homeowner A 🙂.
5. Homeowner B 😢has two weeks to repay the difference if the Cher Impound account was used. If a credit card was used, no harm except additional feeds would be included to handle the transaction.
Notification to both co-owners get sent regardless.
6. Homeowner A 🙂(Chersurance ✔︎) + Homeowner B 😢(Chersurance ✔︎). Homeowner B 😢defaults, two weeks.
At this time, Homeowner B 😢does not have access to withdrawing Chersurance if their credit card is maxed and could not be used.
7. Two weeks has lapsed and Homeowner B 😢still has not paid back Chersurance.
Notification sent to Homeowner A 🙂 and Homeowner B 😢.
8. One year of ownership: Homeowner A 🙂 agrees to find new co-owner without the consent of Homeowner B 😢. Notification is given to Homeowner B 😢that a new co-owner is being found. If a new co-owner is found prior to Homeowner B 😢repaying Chersurance, then Homeowner B 😢is responsible for all closing costs to put Homeowner C 😎on the title/mortgage.
9. ( Homeowner B 😢⇄ Homeowner C 😎) Homeowner C 😎pays 15% deposit of new appraised value of home to Homeowner B 😢less closing costs and Homeowner B 😢can have their Chersurance deposit back is there is anything left while Homeowner C 😎 was being found. This gives 4 months to find a new co-owner if both parties agree to this Chersurance.
10. No guarantee if Homeowner B 😢stops paying their portion, there is 4 month protection. If Homeowner B 😢keeps paying partial payments, the search for co-owners continues.
11. We cannot guarantee a co-borrower will live at the defaulting home. If a co-borrower / new co-owner cannot be found the home must be either rented, bought out, or sold. The payments will go directly to the bank and your credits may be affected if payments cannot be made direct to the bank. At the 3month mark, if no co-owners are found, Cher suggests selling the home. Proceeds to be equally shared at close of escrow regardless if the party had Chersurance.
7. Without Chersurance: Payments made direct to bank , if someone defaults it is up to either homeowner to agree to try and find a co-bo and list to Cher. If there is a missed payment, Homeowner C 😎to acknowledge this condition and to contribute 15% down less any missed payments and closing costs to defaulting party.
8. If both parties are defaulting at both want to opt out, they would sell typical sale.
1. Chersurance less than one year: If no co-bo can be found during defaulting period while Chersurance is being used, cash out is not an option and the owners must decide what to do as a new homeowner is added. Homeowners cannot add any homeowner or substitute co-owners during first year period. They can sell their home, rent it out, etc.
NO NEW CO-BOS ADDED WITHIN A ONE YEAR PERIOD.
If one party has Chersurance, that will be used while a new co-owner is found. Note that would then only be a two month period. No credit is put down since Chersurance is not selected.