Wednesday, January 1, 2014

if a property is willed to an heir, what happens to the mortgage on the property?

Question

if a property is willed to an heir, what happens to the mortgage on the property?



Answer

It depends on what the will or trust says. If the mortgage/trust provides that the mortgage is to be satisfied, it must state that. If the will/trust is silent, then the heir receives the property but subject to the mortgage. This means that the heir now has to pay for the property if he/she wants to keep it.



Answer

No matter what the mortgage needs to be paid. The facts of each situation will determine who is responsible but from the lender's perspective - they do not care. If it doesn't get paid, then they will foreclose.



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