Something is not adding up.  Mortgage payoff, no prob.  $65,000 was ex's portion of the FMV, implying there's the daughter's, which would add another $65 grand to the FMV.  Yet, the total of $252,000 ($122,000 + $65,000 + $65,000) is still significantly smaller than the FMV of circa $300k.

Have the gift tax implications been considered?