Do you have to refinance to put someone else's name on a mortgage?

Question

I got a house for my Daughter and her boyfriend in mine and his parents' name. They make the payment etc... But both I and his parents are at a point where we want out from under it. Is it possible to just add their name to mortgage and remove ours? I know I can deed them the ground, but the liability of the mort. would still be on us.

Answer 1

Respecting everyone's message here: Everyone seems to be telling you that it is possible to transfer the name on the mortgage loan. Well, this is true when it comes to the title. I cannot give you advice how to hold title or legal advice because the law prohibits me from doing it and that's what title companies and lawyers are for.

This is NOT true when it comes to a mortgage loan. Let me explain. The lender accepted to loan you guys the money based on your financial stability, your credit score, current rates, etc, etc. That promise to lend you the money was based on your OWN profile. When you involve other people, everything changes. The loan is a contract in which you and only you (& the cosigner/s) is/are agreeing to pay off that money back to the bank. In order to add or remove people from that loan (contract) you have to re-draw a new contrat (refinance).

I hope this information helped. Good luck!

Answer 2

As other responses have stated, you do HAVE to refinance in order to release the financial obligation from you and the co-signer.

The reason is because a lender has strict guidelines iin which they lend money. They decided based on your credit, income, etc. (and the co-signer) that you were worthy of lending money to..

The bank has no idea what the credit scores, income, etc. of your daughter and her boyfriend are, and they didn't lend the money based off of their qualifications..

So, bottom line is you first have to deed both your daughter abd her boyfriend on the property. After they are on the title, you then do a refinance in only their names..thus removing yourself and the co-signers from any financial obligation..

At that point you need to do another quit claim deed to remove yourself, and the co-signer from the title (or any ownership)..

If you need any other advice, or would like assistance in a refinance feel free to give me a call..

My name is Jason Fry, i work with Providential Bancorp, a nationwide mortgage lender. You can call me at 312-264-6448, or email me at [e-mail]

Thanks, and best wishes!

Jason Fry
Licensed Mortgage Consultant

Answer 3

The mortgager (the bank) has to agree. Usually, to do that, they have to pass the new owner(s) on the usual credit checks.

As for transferring title, well, that's what lawyers are for. If it's not done right, the kids could lose the house if you or the in-laws wind up in debt.

Also, you want to ask the lawyer or an accountant about the tax implications of giving someone a house. If the equity is too high, it may be taxable. ( I think someone once said any gift over $11,000 per year is considered taxable income for the recipient.)

Answer 4

Any title issues can be resolved with a quick claim deed but in order to release financial obligation you do need to have them refinance. Depending on credit and how long they have been making mortgage payments it s pretty easy and they should have little to no problems. I recommend seeking a mortgage broker as they have hundreds of lenders and programs that can fit anyones credit history. I hope this helps you but if you need any help or have any further questions feel free to email me [e-mail].

Answer 5

You can add their names in addition to yours to the loan, but it doesn't get you off the loan. The bank still has a contract with you and I doubt they would remove your name from it (why would the bank want to, they can go after you if the "kids" don't pay). Sad, but true.

The only way to absolve yourself from liability is to make the "kids" get their own loan on the home and in effect, purchase it from you.

After a brief stint in collections at a mortgage company (I hated that job), I know I would NEVER co-sign or sign a loan for ANYONE... and I am sure you won't in the future, either. If someone's name's not on the loan, lots of times there's not much incentive to pay the bills.

Answer 6

Lenders are typically willing to add more folks to an existing mortgage, as it increases their chances of being paid (although employees looking for a commission or referral bonus have been known to say otherwise)

Taking someone off is usually tougher, and unless the existing loan is assumable, you usually have to refinance to do it, and often even then. Just because the lender allows someone to assume your loan does not mean you are necessarily off the hook.

Answer 7

you could get all parties involved to agree to a transfer of ownership. In many jurisdictions, this could be accomplished by a quitclaim deed. It would be best to consult with a real estate lawyer practicing law where you live. This is something you want to get right.

Answer 8

Not sure but I think you would have to refinance.