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marilyn_huntcollins · Joined: 13 Oct 2009 Posts: 5 1.92 Dollars($)

Hi,
My husband and I has been living in his moms house since 1999 and paying the mortgage. She doesn't want anything else to do with the home. How can we take over the property and release her from the loan? Our credit is not good at all but we need to find the steps needed to follow on this matter.

sunnyca2009 · Joined: 04 Aug 2009 Posts: 1731 35.55 Dollars($)

When you say your cerdit is not not good, it is really hard to assess wheats your score

You can go with a FHA loan and buy the house from yoru mother

You will need atleast 3.5% down payment

marilyn_huntcollins · Joined: 13 Oct 2009 Posts: 5 1.92 Dollars($)

Thank you

jveenstra · Posted: Mon Oct 19, 2009 11:51 am Post subject: FHA

The only way to release Mom from any responsibility for the mortgage is to purchase the house from her (Unless, her mortgage is an FHA mortgage. In that case you may be able to "asume" the current mortgage)
While it is correct that you need a down payment of at least 3.50%, you do not actually need any money of your own.
You may purchase the property for $x and Mom can contribute from the purchase price a gift of equity for the 3.500% down payment.
Mom may also agree to a seller concession of $X to cover the closing costs.
The appraised value of the property has to be high enough to cover the pay off of the existing mortgage plus the 3.50% down payment plus the amount of the closing costs.
Of more of a concern is your credit score. You indicate that your credit is not good. You will soon need a credit score of 620 to do any kind of mortgage---Fannie Mae or FRedie Mac or FHA or USDA or VA. This minimum credit score of 620 will become a definite requirement in mid-December.
Righ now there are a couple of FHA lenders who may still do an FHA mortgage with a credit score below 620.
I do not know your middle credit score, however, for you to have any hopes of getting a mortgage, and your credit score is below 620, you better start speaking to a mortgage loan person today to see if it is possible.

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hos can I take over a loan and release someone from their liability?