Posted on: 26th Mar, 2009 09:06 am
After my father passed away, a vacation home which my mother had became more than she could keep up with, financially and in terms of maintenance. Since she wanted it to stay in the family, we decided I would buy it. At the last minute, however, she decided she wanted to go a different route and sign it over to me her equity in the property (about 50 percent).
I checked with the real estate attorney who was going to handle the sale, and he said that was fine, and that I could simply take up paying the mortgage in my mother's name as long as I didn't mind missing the interest deduction. He said the key point was that I be in position to get a new loan on the slim chance that the bank noticed, or cared either way. Only about 60K is owed on the house, so I'm not worried about having to get a loan for that if I need to.
I'm not sure how unusual this situation is.
If I want to have access to the equity in the home to get the money to put in a second bathroom, do I need to get a new loan that pays off the original loan? If so, what kind of loan is that? Is it called refinancing if the loan being paid of is a lien on the property in the name of another person?
Thanks for any advice.
I checked with the real estate attorney who was going to handle the sale, and he said that was fine, and that I could simply take up paying the mortgage in my mother's name as long as I didn't mind missing the interest deduction. He said the key point was that I be in position to get a new loan on the slim chance that the bank noticed, or cared either way. Only about 60K is owed on the house, so I'm not worried about having to get a loan for that if I need to.
I'm not sure how unusual this situation is.
If I want to have access to the equity in the home to get the money to put in a second bathroom, do I need to get a new loan that pays off the original loan? If so, what kind of loan is that? Is it called refinancing if the loan being paid of is a lien on the property in the name of another person?
Thanks for any advice.
since the loan is still in your mothers name you can't simply just refinance it free and clear. if the bank did find out about it being deeded without them being notified and they have a lien on it, you may have a problem.
the best thing for you to do is to assume the payments rightfully with the lender. if the house have already been deeded, have your mother to contact the lender. assuming the payments is so much easier than applying for a new loan. it is more simple that what you think.
so, check with the lender. one of the requirements with having the payments assumed is having the property deeded. since it sounds like this has already been done. you have already cut out one step. but the bank needs to know!
the best thing for you to do is to assume the payments rightfully with the lender. if the house have already been deeded, have your mother to contact the lender. assuming the payments is so much easier than applying for a new loan. it is more simple that what you think.
so, check with the lender. one of the requirements with having the payments assumed is having the property deeded. since it sounds like this has already been done. you have already cut out one step. but the bank needs to know!