Posted on: 30th Mar, 2010 08:51 am
My friend is dealing with divorce and the property she hasn't lived on for a little over one year is now in foreclosure. The property, a balloon mortgage, was originally paid off my her mother-in-law who is the trustee of her own revocable living trust. To recover the money she spent from her trust a new mortgage on the property was set up as Betty Miller, trustee of Betty Miller revocable living trust being the mortgagor: the mortgagees... in this order, Betty Miller (the trustee), Todd Miller and Tracy Miller. My question is can a trustee include her or himself in the mortgage beyond providing the mortgage itself? If that makes sense at all. This entire thing seems odd and I wonder if my friend (Tracy) should remove her name, if she can, from the mortgage due to the trustee, her estranged mother-in-law, coming after her by way of lawsuit regarding the foreclosure. The estranged husband, Todd, still resides on the property but stopped paying the mortgage to his mother when Tracy was tossed from the property. I guess I simply want to know if a trustee can mortgage property to themselves? And should my friend quit claim if she can?
As your friend's name is mentioned on the mortgage, she is liable for the mortgage payments. If she does not make the payments, the lender can foreclose the property. As far as signing a quit claim deed is concerned, it'll only remove her from the property deed and not from the mortgage. For further information in this regard, I would suggest your friend to have a word with her real estate attorney.
the entire scenario is not making much sense, frankly; niicss' recommendation of seeking out an attorney is spot on, and ought to have been the first step taken by your friend.
