If someone dies shortly after buying a home, can their family keep the home even if they have a recent foreclosure?

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If someone dies shortly after buying a home, can their family keep the home even if they have a recent foreclosure?

My husband and I are going through a foreclosure. My fathe-in-law just bought a house for us to live in and take over the mortgage on when our credit bounces back. He just found out he has about a month or so to live. What will happen to the house he “bought” for us? Will the bank allow us to stay and take over the mortage, will they kick us out?

Asked on June 21, 2012 under Real Estate Law, Oregon

Answers:

FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney

Answered 9 years ago | Contributor

Potentially in your situation after your father-in-law passes you and your husband will be allowed to continue living in the home that the father-in-law purchased making its payments.

The best way to position yourself is to tranfer title of the property into some family trust and continue making the monthly mortgage payments in a timely manner as well as keep property taxes and insurance for it current.

Whether or not the lender is obligated to allow you and your husband to assume the loan on the property and continue making payments on it depends upon what the terms of the loan state. I suggest that you meet with a real estate attorney to review these loan papers and discuss the situation with him or her.


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