My husband just passed away while having a mortgage and I have nothing in my name, what will happen with our house?

We have about 25,000 left to pay on our mortgage. I have been making payments and keeping up with everything so that the bank doesn’t take our house. I have no credit or work history here in the US and can’t refinance the home. If refinancing is the only option, will the loan start all over again back to the original price? I can probably get my son to refinance the home if needed but I just need some advice on what I can do. I have nothing that’s in my name and I’m just finding out about this after my husbands passing. Thanks for your help

Asked on July 22, 2018 under Real Estate Law, New York

Answers:

M.D., Member, California and New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

A person who inherits a property becomes responsible for paying the mortgage on it. That is unless the mortgage has what is known as an "acceleration clause" that is triggered by the death of the borrower, typically the lender is required to continue to accept the monthly payment until the maturity date. This is of great benefit to the person who is inheriting since they do not have to go through the lender's application process and qualify for the mortgage.An acceleration clause is a provision in a mortgage that allows the lender to demand immediate payment in full of the remaining balance of the mortgage if certain events occur (such as the sale of the property, late payments, etc.. As a general rule, however, it is rare to find such clauses that provide for acceleration upon the death of the property owner.Bottom line, as long as your keep making all mortgage payments on time, you should be fine.

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 2 years ago | Contributor

Refinancing would not take the loan back up to its original amount: it will be paying off the current loan, at its current balance, and replacing it with a new loan for that same amount.
When your husband passed away, if the mortgage was only in his name, it came due: when a person dies, any loans solely in their name must be paid. The lender could foreclose if the loan's remaining balance (the $25,000) is not paid off. (They don't have to foreclose and could just keep accepting the regular payments, but have the legal right to demand paymen in full and foreclose if it is not made). Therefore, you may need to refinance.


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