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VIC Paying Mortgage - Name Not on Title - What if Son Dies?

Discussion in 'Property Law Forum' started by Adrienne Harris, 27 June 2015.

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  1. Adrienne Harris

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    I am a joint mortagee to help my son get into his own home. I'm not on the title as I never wanted ownership. What happens if he dies? He has a new partner and I am assuming he will leave the house to her in the will. Do I have to keep paying the mortgage if he dies whilst the partner lives there or can I stop paying the mortgage and force a sale and accept any shortfall?
     
  2. Ivy

    Ivy Well-Known Member

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    Hi Adrienne,

    As a joint mortgagee (rather than a guarantor), you are equally obligated to make mortgage repayments along with your son. And yes, if your son passes away you may find yourself in sticky legal situation, particularly if you can't make the repayments.

    Does the bank know that you aren't listed on the title to the property? Because as a mortgagee, the security for your loan is the property. It's problematic if you don't have any rights over the property that is security for your loan.

    I suggest you take your mortgage agreement to a property lawyer to look at and see how to best resolve this situation. Because if your son did pass away, this could end up in court and that would be very costly.
     
  3. Adrienne Harris

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    My own home is the security. I thought I could just not pay the mortgage and the bank would repossess the house and I would cover the shortfall.
     
  4. Ivy

    Ivy Well-Known Member

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    Okay- are you making regular payments on the house? If you aren't making regular mortgage repayments, you could be a guarantor.

    If you default on the mortgage there could be greater implications than simply the bank repossessing your son's house. If for some reason the bank has difficulty getting possession of your son's house they may well come after your house instead.

    If you are a joint mortgagee rather than a guarantor, it's an unusual situation so I can't give more specific suggestions without seeing the agreement you signed. Personally, I would be taking the document to a property lawyer to clarify your obligations and risks involved in what you have signed onto.
     
  5. Adrienne Harris

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    thank you, I will get more legal advice.
     

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