Legal Question in Real Estate Law in Maryland
Taking a name off of the mortgage
My brother is in the process of sueing my parents. When he was in medical school, my father purchased a town house for him to live in, as well as 3 renters. To get a lower interest rate, my father put the my brother on the deed and mortage as a 1st time buyer.
When my brother was ready to buy a home of his own, my father took his name off, and replaced it with my mother's. 20 years ago!
My dad sold the house, making very little money from it.
My brother now feels entitled to half the sale. Never putting any money into it.
Claiming that he had wanted his name off of the mortgage but not the deed.
My father told him that it was impossible to do so. No bank would let you own a home without owning the mortgage as well.
Please let me know if this is the case.
My brother is not entitled to any of the money as far as we are concerned. Never putting any money into it. My father got the house purely so my brother could have a nice place to live at the time. Use of my brother's name was the suggestion of the realtor, in hopes of saving my dad some money. This was not meant to be an investment, but merely a parent doing what he thought was best for his son at the time.
Thank you in advance for your response.
1 Answer from Attorneys
Re: Taking a name off of the mortgage
Hmmmm -- it is not clear to me what exactly is your question. You want to know the odds of winning for your parents?
The one clear question that you have posed is, "No bank would let you own a home without owning the mortgage as well. Please let me know if this is the case."
That is NOT exactly correct. If the bank is satisfied with the creditworthiness of one of the owners, it may agree that only that owner is obligated to repay the debt (i.e. be on the note itself). However, they would always require that any other non-borrower owners sign-off on the deed of trust instrument so that if the one owner who is obligated fails to pay, then they can still foreclose on the property.
So, the non-borrowing owner can still be on the deed and not be obligated on the mortgage (except to the extent that the property itself may be foreclosed if the mortgage is not paid).
The key here is that your brother could not have come off of the title without having signed papers. So, if he actually signed them i think he's going to have a tough time later saying that he didn't understand what he was doing.
Now at the same time, I think all should be careful about what you are saying about the purchase of the first home --- i.e. you make it sound as if your brother's name was put on the deed in name only with no actual intent to be the buyer of the house. I would be cautious in what you say .. in that it starts to sound as if someone actually misled the lender at that time (i.e. committed mortgage fraud) which would be a bad thing.
feel free to call if you want to chat further.
Related Questions & Answers
Looking for something else?
10,200 active attorneys ready to answer your legal questions today.
Featured Attorneys
Earn additional revenue and grow your business.
