What happens if you leave someone a house with a mortgage?
- They can keep the mortgage or refinance.
- If they keep the mortgage, they do NOT have to pass any qualifying test by the current mortgagor. They simply take over making payments.
- They must keep up the payments, or the property can go into foreclosure.
- If the new owner can't afford the current payments, and cannot refinance, then they can sell the house and the equity is theirs. Once you leave them the house, it is theirs to do with as they wish.
- You can also specify that any cash in your estate is to be used to pay off an existing mortgage prior to transferring the house to your beneficiary.
Visit the Law Office of Pamela Parker for help with your Texas estate planning.