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A mother transferred the deed to the house to an 20 something adult child. The mortgage was in the mother's name alone. The mother was dying and has died. The mother was renting the house out before she died and the renter stayed for another year paying a rent check direct to an account that the mortgage was taken out . Now that this house is empty and the adult child has lost their job, they we be unable to pay any rent in 2 months. Also, the mortgage is more then the appraisal on the house.

What are the adult child s options? If they stop paying will the foreclosure impact their credit? The have their own house and mortgage separate. What can they do with the house?

Thanks

gmakerley · Posted: Mon Jul 11, 2011 12:38 pm Post subject:

It seems that adult child is acting in the role of landlord in this situation. There is apparently no obligation for repaying the loan in question, as Mom was the only borrower. Nonetheless, because adult child is the current owner of the home, any foreclosure action brought would be against "AC" as the current owner.

Foreclosure actions are public record, and public records are picked up by credit reporting agencies. Thus, the action would show up on the AC's credit report. That's not to be viewed as a good thing.

AC's current home and mortgage would not be affected in any way. As for the dispensation of the house, AC can negotiate with the lender and offer a deed in lieu of foreclosure or propose a short sale or simply let the house go into foreclosure and let the lender take it over and deal with it in their own fashion.

Guest

Very helpful. This estate is still not settled, would mortgage company be able to go after monies/stocks etc in the unsettled estate if short sell or foreclosure? Would AC be responsible for taxes, insurance since name on Deed? How does that work.

Thanks

smithsussane · Posted: Mon Jul 11, 2011 8:43 pm Post subject:

Hi Reichert!

Welcome to forums!

As far as I can understand, unless the estate is settled, I don't think the lender will be able to go after the monies of the deceased in case of a short sale or foreclosure.

Feel free to ask if you've further queries.

Sussane

gmakerley · Posted: Tue Jul 12, 2011 9:28 am Post subject:

As the owner, AC is, indeed, liable for taxes and insurance. I'm in semi-agreement with Sussane about the safety of "the monies of the deceased" also. I simply don't like the construction of "as far as I can understand..." It's too wishy-washy for me.

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Adult child on deed but not on mortgage, parent dies

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