A divorce decree, VA certificate, and mortgage

[wldcherry1]

             A quick back ground. Bob and Betty were divorced in 2000 in TX. Bob was awarded the house with the stipulation that he would submit the paperwork to release Betty's VA Loan. Also if he no longer used the home as a primary residence he must refinance and release the VA certificate. Bob has still not done this.

Betty finds out that Bob is planning to move. Betty calls VA and lets them know she does not want her VA certificate transferred to anyone with out her permission. Basically VA tells her if they get the proper documents they will transfer the certificate to another veteran with out Betty's approval and her certificate is still tied up.

Betty also calls the mortgage company. They say call VA and say about the same thing. If they get the proper documents they will process the loan. So Bob could sell the house to another veteran and still have Betty's VA certificate tied up. Then Betty's only recourse is to take Bob back to court.

Betty is going to see a lawyer and draft up a letter to VA and the mortgage company saying

I Betty do not authorize my VA certificate in conjunction with my mortgage loan to be sold, transferred, or assumed by anyone without my express permission. My express permission constitutes my notarized signature by a Military Lawyer located in Germany and verbal confirmation by calling 555-5555 and no other phone number. Any other documents authorizing the sale, transfer, or assumption of my VA Certificate and/or loan is fraud upon the party submitting or accepting my signature.

Betty has sent an e-mail to the VA and the mortgage company saying the same thing. Betty is frustrated by trying to put a hold on the mortgage loan and VA but they tell her too bad and Oh by the way if the loan defaults you are still on the hook for it.

Betty has called Bob. He doesn't seem to understand that he may only be transferring the VA certificate and not releasing it. He thinks he is just selling the house like he was supposed to 4 years ago. He could care a less if her VA certificate is released.

1. Is going to the lawyer and drafting the memos and sending them certified to the VA and mortgage company a good idea and will it give Betty any protection?

2. If the transfer goes through does Betty have any recourse with the VA or the mortgage company?

3. If the VA certificate is transferred can Betty sue Bob for the amount of money still tied up in the VA certificate? If not what recourse does Betty have against Bob?

4. What can Betty do to place a hold on any of the proceedings to ensure her interests are complied with as per the divorce decree?

Apologize for forgetting the rules.
As always Thanks.

[socrateaser]

>1. Is going to the lawyer and drafting the memos and sending
>them certified to the VA and mortgage company a good idea and
>will it give Betty any protection?

I've never read the VA regulations, but I very much suspect that transferrability is a condition of making the loan, therefore you will not be able to prevent the transfer.

>
>2. If the transfer goes through does Betty have any recourse
>with the VA or the mortgage company?

Probably not.

>
>3. If the VA certificate is transferred can Betty sue Bob for
>the amount of money still tied up in the VA certificate? If
>not what recourse does Betty have against Bob?

Based on Betty's statement of the original orders re the home and refinancing, Bob's failure to refinance and/or release the cert is contempt. Therefore, Betty should be able to get a court order restraining the title company from releasing of any of the net proceeds of sale, sufficient to protect Betty's interest in the VA cert.

What Betty should have done, and what she could still do, assuming that escrow has not yet closed, is file a Notice of Suit Pending with the County Recorder (aka Lis Pendens), and notify the title company of same. As soon as Betty does this, no lender on earth will make a loan against the property, for fear that they may have to take a back seat to the outcome of the pending litigation.

Of course, Betty must also file a contempt motion, because if there isn't actually any suit pending, then Betty could be sued for interfering with Bob's, and the hombuyer's contract rights.
>
>4. What can Betty do to place a hold on any of the proceedings
>to ensure her interests are complied with as per the divorce
>decree?

See #3.