Question: My husband is listed on the mortgage of our home only, he passed away a few years ago, the bank will not refinance or let me assume the responsibility for the mortgage. I am on the title, if I let the home go to foreclosure will I be responsible for any tax issues. My home is under water by a substantial amount. I tried refinancing with my current bank and other lenders, but was denied several times as the lenders said that I am not the original borrower on the loan.
Response: Situations like these are very tricky. Your deceased husband signed the contract (note and mortgage) with the bank, therefore, he was the one in privity of contract with the bank. You are not in privity of contract with the bank and you have no rights to sign a new agreement, whether it would be a refinancing or a loan modification. Only the borrower can sign the new contract. So far, I have only witnessed one bank offer a loan modification to the Estate of the Deceased. Generally, that is not the case. Some banks will consider an assumption where you take over the original terms of the loan but you have to show qualifying financials. This does not work if you have no income, i.e., your income has to support the mortgage and any arrears, if applicable. If you want to stay in the house, the best option is to continue making payments as before until the loan is paid off unless you are already in default and can no longer reinstate the mortgage. Finally, if the bank forecloses on the home, you, personally, would not be responsible for the deficiency. However, the bank may go after the estate and in a case like yours, it could affect you similarly. As of recently, many banks have stopped pursuing deficiency judgments because it is very hard to collect that money from people who don’t have much to begin with and lost their last assets. Whether they choose to pursue it or not, they do not waive that right.
In the legal blog, Attorney Svetlana Kaplun addresses typical questions our firm has received from our clients, or come across from homeowners related to foreclosure, foreclosure defense, loan modification and bankruptcy topics.
The information contained in the legal blog of Attorney Svetlana Kaplun is for informational purposes only, and should not be construed as a legal advice on any subject matter. Please read our full disclaimer or contact the Law Office of Svetlana Kaplun, P.C. by telephone at 718-444-1115 for more information.
Copyright © 2015 Law Office of Svetlana Kaplun, P.C.
modification, making home affordable, hamp, mortgage modification, harp refinance, making homes affordable, modifications, home affordable modification program, home affordable refinance program, hamp program, home loan modification, loan modification guidelines, foreclosures, foreclosure listings, foreclosure homes, mers, foreclosure settlement, foreclosure homes for sale, free foreclosure listings, foreclosure home, deed in lieu of foreclosure, foreclosure process, how foreclosure works, home foreclosure, foreclosure radar, bank foreclosure, home foreclosures, foreclosure listing, hud foreclosure, foreclosure laws, short sale vs foreclosure, stop foreclosure, totally free foreclosure home listings, foreclosure help, free government home foreclosure listing, free listing foreclosure home sale, free foreclosure listings with pictures, fannie mae foreclosure, independent foreclosure review, lawyers, power of attorney, personal injury attorney, attorneys, power of attorney form, durable power of attorney, power of attorney forms, criminal attorney, attorney search, medical power of attorney, free power of attorney, bankruptcy attorney, power of attorney template, power of attorney form download, durable power of attorney form, free power of attorney forms, general power of attorney, free printable power attorney form, lasting power of attorney, tax attorney, free power attorney forms, divorce attorney, ace attorney, disability attorney, attorney jobs, enduring power of attorney, attorney at law, patent attorney, free power of attorney forms to print, real estate attorney, injury lawyer, personal injury lawyer, defense lawyer, criminal defense lawyer, the lawyer, accident lawyer, a lawyer, criminal lawyer, motorcycle accident lawyer, rocket lawyer, bankruptcy lawyer, divorce lawyer, ask a lawyer, find a lawyer, lawyer referral, car accident lawyer, family lawyer, lawyer search, lawyer find, lawyer ratings, lawyer referral service, immigration lawyer, dui lawyer