GA home mortgage not deeded to borrower?

Question

Is it legal to have a mortgage in one name, call him Mr. X a sole borrower, even though he has signed a quit claim deed over to release all interest/ownership to his first wife Mrs. V?

No, it was not a part of their divorce decree. The divorce decree says the home will be sold "promptly"...that was 9/2003.

It just seems like the mortgage company is at risk this way. Since Mrs. V is not on the mortgage but lives there, Mr. X does not live there but pays rent elsewhere plus the mortgage note Mr. X could easily fall behind. And has.

So if he no longer owns the house, how does the mortgage company protect themselves from a default?

Answer 1

It does not matter who's name is on the deed, the mortgage has to be paid by someone.

The mortgage company has a signed note and deed of trust in it's favor that is their protection. It might not be signed by the person residing in the house. They don't go around knocking on doors to check and see if the person that signed their note and deed of trust is living there.

The original note and deed signer could have moved and this is now a rental. There could be a divorce and one person was told to move, but was still required to make the mortgage payments.

If for some reason the mortgage is not paid or kept current the mortgage company will foreclose on the person that signed the note, it would not matter who is residing in the property.

All court decrees are not honored as this one appears to have been ignored. The courts do not have enough people to check and see if their decrees are followed or not.

Mrs V. might not be able to assume the loan or may not be qualified to get a new loan as the divorce decree indicate, and Mr X is simply helping Mrs V out the best way he possibly can.

Why are you interested in this property, are you planning to purchase it?

Now most lenders have a clause that says a new person must qualify for the loan if the person that signed for the mortgage sells the house to someone else.

That is not always the case, because some get around this clause by carrying a 2nd mortgage, with the new buyer paying the seller for both the first and second. The seller then sends the money due the first as if they are still residing there.
This is done a lot in the real estate field by savvy real estate investors.

if caught and the lender call the loan, they simply refinance the house and keep on trucking.

I hope this has been of some use to you, good luck.

"FIGHT ON"

Answer 2

Well if the original mortgage loan that was taken out in his name is the same company that is being paid now and he didn't notify them that he changed title of the property to another person, thats usually called an unathorized transfer. I don't know if its legal or not but he should have notified the lender before he did that. The lender could call the Note "All due and payable" and he would have to immediately pay off that loan for violating the terms of the agreement. He should sell it to her or give it to her and let a title co or escrow co handle the transaction so that its done properly, but again, if its still the same original mortgage, it should be paid off to release him of liability and that mortgage co.

Answer 3

Mrs X is at risk. She is second in line behind the mortgage company and will not be notified that the payments are delinquent (unless those notices are sent to her address).
The mortgage company will foreclose if the payments fall too far behind so their investment is protected.

Answer 4

No, a stop declare deed would purely circulate her call off of the call to the valuables. If she is on the internal maximum loan(the internal maximum loan) then the only thank you to get her off of it somewhat is to refinance the internal maximum loan into your call purely.