How will an HELOC loan on real estate effect with 4 tenants in common?

We put the names of 2 adult children on our deed to try to ensure that ownership stays in the family after we pass. We own half and they each own one quarter. Now we are drawing down our retirement money, mostly to care for the home. Our primary legal home is a condo in MD. Our financial advisor suggests a HELOC as one of several possible solutions. I know the kids have to sign loan papers. What I don’t know is if the loan has to be in all of our names. Upon our death, they could end up with a large balloon payment which I think they would have to pay off or refinance/pay down in order to keep the house?

Asked on September 11, 2018 under Real Estate Law, New Hampshire


SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

1) Yes, all owners--everyone on the deed or title--must sign off on and consent to the loan.
2) Everyone who signs the loan is responsible or liable for it--so if it i not paid off at your passing, your children will both be personally responsible for it and could lose the house (have it be foreclosed upon) if the loan is not paid.

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