If a man owns property with 2 others but his is the only name on the deed, what happens ifhe mortgages the property without the other owners’ permission?

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If a man owns property with 2 others but his is the only name on the deed, what happens ifhe mortgages the property without the other owners’ permission?

Bob, Kelly and Jane are brother and sisters. They went in together and purchased a home at $60k each in cash. Bob handled the transaction and has deed in his name. Bob prepared a “contractual agreement” stating that all 3 are co-owners of the property. 6 months later, Bob took out a mortgage on the property without advising the other 2 co-owners. Now 4 years later, the other owners find out about the mortgage because they want to sell the property. Bob refuses to do anything because he feels that he didn’t do anything wrong. Do you think the mortgage company would do anything if contacted?

Asked on May 16, 2011 under Real Estate Law, Florida

Answers:

M.T.G., Member, New York Bar / FreeAdvice Contributing Attorney

Answered 10 years ago | Contributor

Like what?  Set aside the mortgage? No, I don't think that the mortgage company will do anything out of the goodness of their heart.  I think that you are going to have to sue "Bob" based upon your contract.  Whose bright idea was it anyway to put the property only in Bob's name?  And what does the contract say anyway?  Does it mention encumbrances on the property from one of you and not agreed to by all of you (which would be against some contract law on your state books I would think as unconscionable)? I think that Kelly and Jane need to go and see Vito the attorney and speak with him about this all.  Bring the agreement.  Good luck. 


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