Posted on: 20th Jan, 2010 12:32 pm
if i use the quit claim deed to add my granddaughter to the deed, will she be responsible for the balance of the mortgage if i were to pass away before paying if off completely? can the creditors take my home?
most of the time when family members add or delete other family members, the lender is the last to know. as long as monthly payments continue to flow into the lender, most of them don't seem to mind that. in this case, if your granddaughter continues to make payments after your passing (if it takes place), then she'll likely never incur the wrath of the lender and when it's paid in full, she'll simply continue on without a mortgage.
if the lender gets wind of the quit claim, of course, that could trigger the due on sale clause in your mortgage, as you are indeed transferring title. should that take place, they won't be too upset as long as you and she undertake a refinance of the existing mortgage to make the lender happy.
most cases don't go that far, and i'll therefore say that you have little to concern yourself with in that regard. that's just my opinion, of course. don't take it as legal advice, please - i'm not a lawyer.
if the lender gets wind of the quit claim, of course, that could trigger the due on sale clause in your mortgage, as you are indeed transferring title. should that take place, they won't be too upset as long as you and she undertake a refinance of the existing mortgage to make the lender happy.
most cases don't go that far, and i'll therefore say that you have little to concern yourself with in that regard. that's just my opinion, of course. don't take it as legal advice, please - i'm not a lawyer.