Is it possible to re-deed without involving the mortgage company?
by Mortgage Rates on Wednesday, November 10th, 2010 | 5 Comments
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Whose name is the loan in?
Edit: You probably should consult an attorney. If one parent is deceased and the house/loan is still under their name, you may have some problems. That should have been cleared up when your deceased parent’s estate was probated.
Nope, cannot do it.
Problem #1 – Having the property in a deceased person’s name. Other parent is going to have to see an attorney to resolve that.
Problem #2 – Quit claim deed (quick change deed) is a very flimsy way to convey title. The quit claim is usually used as a way to correct title, not convey. Not recommended, at all.
Problem #3 – Even if you do a quit claim to convey title, you still probably are not getting an equity loan due to your credit.
Problem #4 – How are you going to access the equity without involving a lender?
Problem #5 – Even if the loan was assumable, the lender would have to approve you, which doesn’t sound likely.
Texas will not recognise a quit claim.
You have to purchase the property from your parents and obtain your own home loan in order to gain title. Your parents mortgage company will not consent to you being added to their title in any way.
Well Uncle Bob, you have no legal rights to this property. Those that do are the only ones that can sign the deed over to you. We understand your credit issues, and it’s good evidence of your lack of money management, but it also makes me suspicious that you are even asking these questions. If the house is such disrepair I would think you would help your parents in having it repaired. If they have any equity in todays economic market, they could refinance it and provide you funds as you make the repairs. But I wouldn’t advise they sign anything over to you.
I’m not fully sure exactly what you’re trying to do. However, you can get at least part of the way there.
First, the ownership issue has to be cleared up. There has to be clear title. That probably will involve a lawyer.
Once there’s clear title, there are plenty of ways to put the property into your name without involving the mortgage company. You can do a “subject to,” having the owners deed the property to you and you make the mortgage payments. It’s not an assumption, since the loan isn’t assumable. And it does violate the lender’s due on sale clause. But investors do it all the time; it’s not illegal.
Another option: The owners transfer the property into a land trust which they create. Then you’re added as a beneficiary to the land trust. Technically, the trustee owns the property. However, with power of direction, you can direct the trustee to do as you wish. However, while this would give you control (and even ownership of the trust), you wouldn’t be able to tap the equity.
To tap the equity, you could sell a portion of the land trust.
Or–better–have the property owner(s) tap the equity (such as through a HELOC) and gift that amount to you. You then take the property subject to, so now you own the property and you’ve gotten the proceeds of the equity.
Or, you could purchase the property from its owners using a wrap mortgage.
See a good real estate lawyer regarding these and other options.