What Happens To The Mortgage On A House That Is Left To Me In A Will?
Posted by admin on October 28th, 2009 at 05:06am
A relative will be leaving me a house in their will. If there is a mortgage (home equity) on the house when they die, do I take over the mortgage? I intend on selling the house when it is left to me.
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4 Comments for What Happens To The Mortgage On A House That Is Left To Me In A Will?
1. Lost in Massachusetts | October 28th, 2009 at 5:06 am
It goes with the property. If you(or the executor) don’t pay the mortgage the lender will foreclose. If you wish to sell, by all means do so but make the mortgage payments while you are the owner.
And, by the way, you are not required to take the property–you can decline the inheritance if there is no equity or not enough equity to make it worth your while.
2. frak1a12 | October 28th, 2009 at 5:16 am
to quote another answer:
“in most all cases, there is a mini
clause in a mortgage note that
states if the obligee dies before the
debt is paid, xyz insurance company will
pay off the mortgage.
IN NO NO NO circumstances is
any relative ever obligated to pay off
another deceased relative’s mortgage.
meaning those who were not on the
note in the first place]”
Indeed, you don’t have to pay off the debts of the deceased, however, the bank wants their money, and they will foreclose on the property if the mortgage payments are not made.
If the beneficiary of the house feels that selling the house will not produce enough money to get any equity out of it, they should refuse the property at probate. Then it’s 100% the bank’s problem.
3. boileret | October 28th, 2009 at 6:13 am
in most all cases, there is a mini
clause in a mortgage note that
states if the obligee dies before the
debt is paid, xyz insurance company will
pay off the mortgage.
IN NO NO NO circumstances is
any relative ever obligated to pay off
another deceased relative’s mortgage.
meaning those who were not on the
note in the first place]
4. kemperk | October 28th, 2009 at 6:23 am
Keep making the payments! You don’t want that house to be foreclosed upon.
Also, now is NOT the time to sell a house. Sellers are paying 10-15% OF THEIR EQUITY to realtors, to buyers down payment assistance/closing costs, and seller closing costs. You are MUCH better off to rent it. You will receive LOTS of tax breaks though you may not be able to write off the mortgage interest until you refi that mortgage in your name.
Best of luck!
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