Will we lose our home or can we re-modify our loan? How? 5 Answers as of September 21, 2015

My grandfather, who passed away, took out a mortgage on a home to help his stepdaughter buy a house in 2011. His stepdaughter (my aunt) has been trying to get a loan modification but the bank has made this whole process a nightmare. My grandfathers' widow would like to help if she can. Any advice?

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Law Office of Pamela Braynon | Pamela Y. Braynon
Your aunt should be able to modify the loan *if* she qualifies. Know that if the loan is not paid it will be foreclosed on. She can always shop around for other loans.
Answer Applies to: Florida
Replied: 9/21/2015
Ronald K. Nims LLC | Ronald K. Nims
If the bank made the loan to your deceased grandfather, then getting a modification is going to be impossible. Banks discriminate shamelessly against the formerly animate, just because the dead haven't made payments in the past, banks stereotype all deceased persons as bad risks. Even Obama cruelly cuts off their Social Security benefits on the pretext that they have no living expenses. Your aunt needs to take out a new loan in her own name.
Answer Applies to: Ohio
Replied: 9/17/2015
Law Offices of George H. Shers | George H. Shers
Your statement of the facts is very unclear. ?If your grandfather took out a mortgage in his name on the home he lived in, upon his death the loan documents probably deem that to be a sale/transfer of his interests [they gave him a loan based upon his ability to pay off the loan, not some one else's ability] and that the mortgage has to be paid off in full unless the bank is willing to agree to different terms. ?That is not a legal issue. ?If he took out a mortgage on the home your aunt lives in so that she could "buy" it, on his death the bank probably can call the loan and require it to be paid off unless they feel you aunt is qualified to make the payment [if so, they will probably want some additional payment to do the new terms].
Answer Applies to: California
Replied: 9/16/2015
Sebby Law Office
Sebby Law Office | Jayne Sebby
If your aunt can get a new mortgage on the property, that's the best way to deal with the situation. However, if that doesn't work, the widow can loan or co-sign or even pay off the mortgage herself. However, there are tax consequences to each of those actions. Check with an accountant or attorney experienced in mortgage, loan, and gift laws.
Answer Applies to: Nebraska
Replied: 9/16/2015
Ashcraft & Ashcraft, Ltd.
Ashcraft & Ashcraft, Ltd. | Randall C. Romei
Your grandfather obtained the mortgage based upon his credit. It seems that the mortgage was secured by the home purchased in 2011 and therefore it is likely that the grandfather had an ownership interest in the property. Now that the grandfather has passed away, your aunt is attempting to obtain a loan and mortgage based upon her own credit. It will be a new mortgage, it cannot be "modified". It is not clear from your description why the aunt must obtain a new mortgage. Did she have an ownership interest in the property at the time of the original mortgage? Was she a co-signer on the original mortgage? Your grandfather's widow could help by cosigning the note and mortgage or by gifting sufficient cash to reduce the amount of the note to a sum sufficiently low for the aunt to qualify for the loan.
Answer Applies to: Illinois
Replied: 9/16/2015
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