What happens to your home mortgage when you die?
Is it possible for a home mortgage to dissolved upon the home owner or borrowers death? I figured the estate or family is responsible but what if the home has no next of kin or goes to the state or something. Question has come up a few times in conversation. Called a big bank and they don’t know how to answer this question. Does this have anything to do with recourse and/or non recourse?
No related posts.
Related posts brought to you by Yet Another Related Posts Plugin.
Tags: Borrowers, Home mortgage, Non Recourse
August 18th, 2010 at 3:18 pm
No, it’s not dissolved upon death, a debt is a debt, and the mortgage will have to be paid out of the deceased’s estate.
I obtained probate on my mother’s estate, but first I had to prove as far s possible that her estate owed nothing, so not just mortgage but things like store cards, cable company etc had to be paid up.
Perhaps you are thinking about the fact that most people have life insurance when they take out a mortgage as a condition of the lender granting the loan.
In this case the mortgage is paid off upon the death of the mortgagee.
Hope this helps.
August 19th, 2010 at 11:10 am
I believe you can buy insurance that will pay off your loan when you die, much like you can do for your car loan. A loan is a loan and your estate will have to pay it off or it will be reclaimed. That is why you should leave a will if you have no next of kin. . .so that you leave whatever you have to whomever or whatever you prefer.
August 20th, 2010 at 11:43 am
If you have no will or heirs, the home will go to the lending institution that holds the note. It is, after all, technically their property until it’s paid for in full. This has nothing to do with recourse or non-recourse, there is no one to collect from so they just take the house. If you are looking for the best home mortgage rates or want to reduce your mortgage loan payments, check out this site
Here you can get free quotes from all available companies in your area. its the best way to find an affordable payment with a reliable company.
Hope this help,