Posted on: 20th Oct, 2009 11:27 am
I am recently married. My husband has his own home and has a mortgage. Since he had this home prior to us getting married, my name is nowhere on the mortgage or deed. If something happens to him, what happens to the home?
the answer probably depends upon in which state the property is located. i am guessing that state laws vary on this subject.
for example, in nj the marital home is owned by both the husband and wife, regardless of who is on the mortgage and/or the deed.
regardless of which state, the safe way is probably to quit cliam the deed from the husband's name into the husband and wife's name, then you are both on the deed and you are both owners.
this does not get you onto the mortgage. that is not all that necessary. it means nothing to ownership, it only means you are not getting "credit history" credit for the mortgage. the only way to get the wife onto the mortgage is to refinance into a new mortgage in both names.
if you mention in which state the property is located, you may get a better, state specific answer.
for example, in nj the marital home is owned by both the husband and wife, regardless of who is on the mortgage and/or the deed.
regardless of which state, the safe way is probably to quit cliam the deed from the husband's name into the husband and wife's name, then you are both on the deed and you are both owners.
this does not get you onto the mortgage. that is not all that necessary. it means nothing to ownership, it only means you are not getting "credit history" credit for the mortgage. the only way to get the wife onto the mortgage is to refinance into a new mortgage in both names.
if you mention in which state the property is located, you may get a better, state specific answer.
Forgot to mention, your husband's and your will should also be redone if necessary, leaving the property to each other in case of whatever.
sarah, just to add on to what john has said - the will issue is very important, there are horror stories all over these forums about estate problems.
Also, if you are going to be contributing towards the mortgage at all, you may want to look at getting your name onto it as it will help your own credit score.
Also, if you are going to be contributing towards the mortgage at all, you may want to look at getting your name onto it as it will help your own credit score.
>>If something happens to him, what happens to the home?
You should refinance the property so both of you are on the Note and Title.
If you can't do that, you should get a Living Trust - that'll enable Title to be transferred into your name if he passes. Then continue to pay the mortgage payments until you can refinance the note into your own name.
Do not have yourself "Quit Claimed" on Title, because that'll invoke the "due on sale" clause with your note, and that'd be painful ... you don't want to have to subject your family to that.
You should refinance the property so both of you are on the Note and Title.
If you can't do that, you should get a Living Trust - that'll enable Title to be transferred into your name if he passes. Then continue to pay the mortgage payments until you can refinance the note into your own name.
Do not have yourself "Quit Claimed" on Title, because that'll invoke the "due on sale" clause with your note, and that'd be painful ... you don't want to have to subject your family to that.
Just a note, adding your name to the title does NOT invoke the due on sale clause.
The due on sale clause is invoked when someone is already on the mortgage and title and is quit claimed off title.
The due on sale clause is invoked when someone is already on the mortgage and title and is quit claimed off title.
All the Notes my clients have signed say the Note is due and payable if Title is changed in any manner after the Note has been signed.
Lenders don't like having people added to Title when they're not obligated by the Note, because they gain an ownership interest in the house. That creates a problem for the Lender if they need to foreclose. Foreclosure is a fairly simple legal process if everybody on Title matches everybody on the Note, but what does the Lender do if there are additional people on Title, and those people feel it's not fair for them to have to give up their house. After all, they were making their monthly payments on time, and it's not their fault the person who is obligated by the Note wasn't as responsible and didn't make their payments. When that happens it becomes a mess, and the Lenders I do business with try to avoid it by saying Title isn't allowed to be changed in any manner after the Note has been signed and Title recorded.
With one exception, and it has to be approved by the Lender first. Title is allowed to be put into a Living Trust, but the Lender needs to review the Trust first, to ensure it's compatible with the Note.
Lenders don't like having people added to Title when they're not obligated by the Note, because they gain an ownership interest in the house. That creates a problem for the Lender if they need to foreclose. Foreclosure is a fairly simple legal process if everybody on Title matches everybody on the Note, but what does the Lender do if there are additional people on Title, and those people feel it's not fair for them to have to give up their house. After all, they were making their monthly payments on time, and it's not their fault the person who is obligated by the Note wasn't as responsible and didn't make their payments. When that happens it becomes a mess, and the Lenders I do business with try to avoid it by saying Title isn't allowed to be changed in any manner after the Note has been signed and Title recorded.
With one exception, and it has to be approved by the Lender first. Title is allowed to be put into a Living Trust, but the Lender needs to review the Trust first, to ensure it's compatible with the Note.