Adding A New Person To A Mortgage
By Ilyce R. Glink and Samuel J. Tamkin
Summary: A daughter pays for her mother's
mortgage, insurance and taxes. She wonders if her name can be added to the mortgage.
Sam explains that you canít really add your name to the mortgage.
Q: My mom owns a home and her name is on the mortgage. I was wondering if we could add my name to the mortgage since I already pay all of her mortgage payments, taxes and insurance.
A. You canít really add your name to the mortgage. In general, when you obtain a loan you sign a note and a mortgage. Each of these documents is for the benefit of the lender. The note your mother signed is her promise to repay the debt and the mortgage is the document that secures the debt.
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If the borrower fails to pay what is owed on the note, the lender can foreclose on the home and sell it to pay off what is owed.
To add your name to the mortgage, you would have to be one of the owners of the home. If you want to add your name to the title to the home, the title can be transferred from your mother to you and your mother. You would have to decide how you would want to hold the title to the home. If you own the home jointly, you and she would own equal undivided shares. You could also each own a percentage of the home. For example, you could own a 10 percent interest in the home and your mother 90 percent.
Why do you want your name on the mortgage? If the sole reason you want to transfer title in your name is for the tax benefits (because you can deduct interest paid on the loan), you may wish to consult with a tax advisor to determine the best solution for you.
Depending on your assets and your momís assets, it may be better for you to own the home entirely and allow you mom to live in it. In other cases, it may be better for your mom to continue to own it entirely.
Samuel J. Tamkin is a Chicago-based real estate attorney. Ilyce R. Glinkís latest book is 50 Simple Steps You Can Take To Sell Your Home Faster and For More Money In Any Market. If you have questions for them, write: Real Estate Matters Syndicate, PO Box 366, Glencoe, IL 60022 or contact them through Ilyceís website www.thinkglink.com