What can we do if the underwriter for our mortgage loan making our loan approval difficult due t a misunderstanding?

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What can we do if the underwriter for our mortgage loan making our loan approval difficult due t a misunderstanding?

My husband is on the deed of his parents’ house; we do not live with them. He also has a joint account with his father to make sure their bills are paid on time (i.e. taxes etc.) but the checkbook only has my husband’s name on it. So now the underwriter is trying to say that he pays for the taxes on his parents’ home. Yes he writes the checks but it’s not actually his money; he has power of attorney as his mom has Alzheimers and his dad never had to take charge of bills. Therefore, we will be denied our mortgage loan because of this. We honestly don’t pay taxes for a house we don’t live in; we rent an apartment of our own. I’m so confused as to why this could happen since my husband is only doing right by his parents. What we can do to get our dream home?

Asked on November 16, 2017 under Real Estate Law, New York

Answers:

SJZ, Member, New York Bar / FreeAdvice Contributing Attorney

Answered 3 years ago | Contributor

Your husband will have to disentangle himself from his parents financially; otherwise, since he *is* an owner of their home (if you are on the deed, you are an owner), they will count any costs or liabilities involving that home (e.g. taxes, mortgage, insurance, etc.) against him--they will assume he is "carrying," or paying for, another house. And if the checkbook "only has my husband's name on it," then they will logically and reasonably assume that is his account and therefore that the checks he writes from--i.e. the expenses he pays from it--are his, too.
He may need to close the joint account and replace it with one only in his father's name, even though he'll keep the POA to have authority and will have to make sure the bank honors his POA. (His father should likely make the account payable on death or transfer on death to him, so it comes to him when his father passes.) And he may need to be removed from the parent's house deed. Ask the loan officer what exactly needs to be done IF she can't convince the underwriter to overlook these elements; bear in mind that banks are not required to lend, you don't have a right to a loan (it's voluntary for them to give you one), and so you have to make the bank happy.


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