am I liable for the promissory note?

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am I liable for the promissory note?

My father built me a house and holds the note in a private mortgage. We structured it legally for tax purposes so I could write off the interest. However, he was gifting me the mortgage payments for 12 years until he passed recently. My mother wants the principal and back interest paid to the estate. We have nothing in writing stating that he was gifting me the payments, only a 12 year track record of non-payment. How would this settle in probate?

Asked on November 27, 2017 under Estate Planning, North Carolina

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Without written foregiveness of the mortgage payments or other written evidence that these amounts were foregiven or gifted to you, you will be liable for them: a written note can only be modified in writing, and non-written statements or actions do NOT affect the oblgations under the note. The estate can sue you for the full amount you owe under the note to date, and/or settle it with you on any other terms that you and the estate's executor or personal representative find mutually agreeable (e.g. giving up you claim to an equivalent value from the estate).


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