I don’t care to add to the comments above about people’s views on family or marriage.

Some comments make me speculate on people’s personal lives and I really don’t like doing that–even involuntarily. Ick.

Regarding the issues brought up by the thread author:
As I understand it, the property and all the down payment are community property. Husband gets back half the proceeds (or lack thereof) and is liable for half the unpaid or forgiven debt (should he sell short).

Regarding the loan, it is unlikely that any occupancy requirement is enforceable. Most owner occ loans have some similar clause and nobody enforces it if the owner’s circumstances change. The only time we see those followed is when there is legitimate mortgage fraud (google Todd Lackner some time) or when the loans are especially non-standard (eg: a private or hard money lender).

Also, it might be obvious but both people on title have to agree to the sale.