Legal Question in Wills and Trusts in New Jersey
Refinancing property of an estate
After my mother-in-law passed away, my wife and her 3 sisters and 1 brother inherited the house that my mother-in-law lived in.
The original mortgage and other payments are being jointly, while one of my sisters-in-law still lives in the house (she pays a higher percentage).
They would like to refinance the house and get a lower rate. Can they do it under the estate, or would this require them to sell the house to one of them and then have that person refinance?
2 Answers from Attorneys
Re: Refinancing property of an estate
It mostly depends on the requirements of the mortgage company/bank. Title may have to be in all their names or the one sister if she wants to buy the others out. Also a tax waiver has to be obtained from the State to transfer clear title. If you need help or have documents to be prepared please contact me.
Bernie Berkowitz
Re: Refinancing property of an estate
You do not say what the ultimate plans are between the owners for the house. Are all people involved keeping an interest, or will one or more buy it from the others, or will it be sold? These answers will determine how a refinance should be undertaken. If one heir is going to own the entire house, best is to complete a sale to that person and let them take a new mortgage to buy out the others. If they all are going to keep it, transfer title from the estate to all of them, and let them all apply for a refinance. If it is to be sold, the estate could refinance and pay the new mortgage when the house is sold, or they could transfer the house to themselves, refinance as a group and then pay off when the house is sold.
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