What to do if a joint owner mortgaged property without the other owner’s consent?
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What to do if a joint owner mortgaged property without the other owner’s consent?
Parents divorced, my mother was awarded 50% of the family home, and father passed away leaving a Will. My mother was given permission by the children to live in my father’s house for free. The house is now sold with the exchange of contracts taking place as we speak. Suddenly, today, the executor has written to me explaining my mother had taken out a mortgage in her name and the mortgage lender needs to be repaid. This would mean the children will receive virtually nothing once the sale of the house is complete. Is there anything that the children or executor can do?
Asked on January 11, 2012 under Estate Planning, West Virginia
Answers:
FreeAdvice Contributing Attorney / FreeAdvice Contributing Attorney
Answered 12 years ago | Contributor
The first thing that you need to review is the loan agreement and the security agreement on the family home with the lender. Your mother who received 50% of the family home was entitled to use her share in the home to obtain a loan. The issue is whether or not the loan that she received exceeded 50% ownership in the property.
I suggest that you consult with a real estate attorney to review the documents concerning your mother's loan where the family home was used as security to make sure she did not obtain a loan at the time exceeding one half of the value of the home.
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