Posted on: 20th Mar, 2008 01:18 pm
my situation and question. i have a regular mortgage which is affordable, but i also have a heloc which i'm behind on payments and it is not affordable. because i have gotten behind on the heloc my fico score is too low to refinance. if i could combine the two loans i would be in much better shape.
i have a son that has good credit and makes a good living and would like to help me out. could i quick deed to him have him refinance and then quick deed back to me so it takes him off the hook?
please let me know
regards,
gail bearden
i have a son that has good credit and makes a good living and would like to help me out. could i quick deed to him have him refinance and then quick deed back to me so it takes him off the hook?
please let me know
regards,
gail bearden
hi gail,
a quit claim deed only tranfers ownership on the deed not the loan. so in this example, if you were able to quit claim the home into your son's name, have him refinance it, and then, quit claim it back to you...it would not achieve your goal, because although he would have quit-claimed his interest in the property back to you, he would still be tied to the property through the loan.
one option is to see if it is possible to use fha to refinance all of the debt into one note. they are much more lenient on credit and it would be the best option for you.
second option would be to bring your son on as a non-occupant co-borrower...that may make it possible for you to refinance it if option 1 doesn't work.
third option would be for you to "sell" the property to your son and have him get financing that way. in this scenario, he would be on the deed and the note; which is the same way it will end up if you do it the way you suggested, except that you are "selling" it to him vs quit-claiming" it to him. if he already owns a home, he could possibly structure it as a second home, depending on where he currently lives.
i think seasoning will also be an issue with the way you are proposing. lenders are wise to the fact that family members will help out family members by doing this, and that is why there is usually a 6-12 month seasoning requirement on quit-claim refinances. this means that your son would have to be on the deed for 6-12 months b4 they would allow him to refinance it.
so probably your best bet would be option 1, and if that doesn't pan out, then move on to option 2. if those don't work, i know option 3 would...
a quit claim deed only tranfers ownership on the deed not the loan. so in this example, if you were able to quit claim the home into your son's name, have him refinance it, and then, quit claim it back to you...it would not achieve your goal, because although he would have quit-claimed his interest in the property back to you, he would still be tied to the property through the loan.
one option is to see if it is possible to use fha to refinance all of the debt into one note. they are much more lenient on credit and it would be the best option for you.
second option would be to bring your son on as a non-occupant co-borrower...that may make it possible for you to refinance it if option 1 doesn't work.
third option would be for you to "sell" the property to your son and have him get financing that way. in this scenario, he would be on the deed and the note; which is the same way it will end up if you do it the way you suggested, except that you are "selling" it to him vs quit-claiming" it to him. if he already owns a home, he could possibly structure it as a second home, depending on where he currently lives.
i think seasoning will also be an issue with the way you are proposing. lenders are wise to the fact that family members will help out family members by doing this, and that is why there is usually a 6-12 month seasoning requirement on quit-claim refinances. this means that your son would have to be on the deed for 6-12 months b4 they would allow him to refinance it.
so probably your best bet would be option 1, and if that doesn't pan out, then move on to option 2. if those don't work, i know option 3 would...
Hi Gail,
Welcome to the forum.
Kim has really shown you so many great options. I think you can simply quitclaim the property to your son if he can be able to refinance and combine the two loans into one.
Although, if he quitclaims the property to you after refinancing the loan he will still be responsible for the mortgage. So I think he can just add you on the deed and you can make the payments on behalf of him. Thus you can at least save your credit and the property from foreclosure and also will be on the deed.
Feel free to ask if you have any further questions.
Best of luck,
Larry
Welcome to the forum.
Kim has really shown you so many great options. I think you can simply quitclaim the property to your son if he can be able to refinance and combine the two loans into one.
Although, if he quitclaims the property to you after refinancing the loan he will still be responsible for the mortgage. So I think he can just add you on the deed and you can make the payments on behalf of him. Thus you can at least save your credit and the property from foreclosure and also will be on the deed.
Feel free to ask if you have any further questions.
Best of luck,
Larry
