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marannkell · Joined: 12 Jun 2009 Posts: 1 1.00 Dollars($)

A family member has recently borrowed money from his Mother. He owns his home outright and is offering his home as security for the loan. The amount of the loan is approximately equal to the value of the house. What are the options here?

Niicss · Posted: Fri Jun 12, 2009 1:29 am Post subject:

Hi marannkell

The family member and his mother will have to sign an agreement which will declare that the property is a collateral for the borrowed money. Both of them can consult an attorney who would draft the deed for them. The deed will note all the required clauses and look after the best interest of both the parties.

However, it should be noted here that, as the personal loan will be secured by a real estate property, it will become a mortgage. It won't remain a personal loan any further.

Thanks.

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How is an existing personal loan secured by real property?