A deceased person’s house is definitely the most precious asset, however this does not mean that he has lived enough into it to pay off the mortgage. When you inherit a property with a mortgage, then you actually inherit both. You get the property as well as the loan that your decent owed. The good news is that the lender cannot say that the loan is due till you are making the payments. An inheritance is certainly a good addition to your financial condition. You may decide what you will do with your inherited property.
Under some circumstances, you may have to pay off the entire loan amount within a very short time. The options that are available to you will depend on your relationship with the person who has named you as beneficiary of the house and the terms of the mortgage contract that they originally signed.
What is there in the will?
The person who has left the property for you in his will may have specified the outlook of the mortgage too. If it is there in the will that you’ll get the inherited property absolutely free, then the executor of the property is held responsible to pay off the mortgage by using other assets in the property. If the will does not particularly declare what you’ll do with the loan, then the mortgage will come along with your inherited property. In this situation, you’ll have to continue making the payments on the loan.
Why is it needed to get in touch with the lender?
If the executor of the will had not talked with the lender, then you should get in touch with him to inform them of the death of the owner. You should send him a copy of the death certificate of the property’s owner. However, the death of the owner does not mean at all that you’ll have to refinance the mortgage. If you’re a relative of the deceased person, then the loan can stay if you want to take the property of the deceased. You may pay off the loan in due course of time. If you’re thinking to keep the loan, then you should provide the lender your contact details so the payments you make start appearing in your mailbox. However, if you are not a relative of the deceased person, then the lender has the right to implement the loan’s due-on sale-section that requires a pay-off of the outstanding balance.
What do you want to do with the property?
Before you go away very far with the mortgage payments on the property, you should take up a decision as to if you want to keep the property or sell it off. If you want to own the property, then you need to know that there are lots of responsibilities associated with it. Make sure you are aware about the consequences of holding the property. However, if you want to sell off the property, then you should list the property on sale as soon as you can, particularly if you find that the mortgage payments are a burden for you. You may speak with an attorney and a real estate agent in order to be sure that the entire process runs smoothly when you find a buyer for the property.
Though you’ve take over the property, you are not legally responsible to make the mortgage payments. If you find there isn’t any equity in the home or your finances aren’t strong enough to make the payments, then it is advisable that you get in touch with the lender immediately. You may work with the lender to let them take away your property or let the house go into foreclosure. Thus, if you are thinking to hand over the property to the lender, consulting with the lender may provide you mental satisfaction by taking into consideration the pitfalls associated with it.