Foreclosure of a Mortgage When the Borrowers Have Only a Survival Interest
My question involves real estate located in the State of: Kentucky
In 1995 my in-laws deeded property to my husband and I on a survivorship deed. At that time, we got a mortgage and built our home. Their home also is on our property. Since then, my in-laws have been put in a long term care facility and my husband has lost his job. We are working as hard as we can but are in danger of foreclosure. My question is: Can the mortgage company foreclosure on the property since the loan is in both my husband's and my names but the property is technically still in the names of my in-laws? It was my understanding (when I just recently realized the deed was a survivorship deed) that the property will belong to my in-laws until both of them pass away and at that time it will transfer to my husband and I.
Re: Foreclosure with Survivorship Deed (Still Living)
When you got your mortgage, was it known to the mortgage company that you did not own the property?
Re: Foreclosure with Survivorship Deed (Still Living)
What are you calling a survivorship deed? If you are referring to a deed where you are all joint tenants with rights of survivorship, then you do own the land. If you are referring to a life estate to the parents with you and husband being remaindermen, depending on everything involved your parents could be at risk to lose the life tenancy or if their rights are secure, the lender may have a right to buy out their life tenancy.
You really need a lawyer to review all of the germane documents and advise you.
Re: Foreclosure with Survivorship Deed (Still Living)
The mortgage company has a copy of the deed on file. We also paid for a title search which I thought also showed property ownership.
My survivorship deed states that property ownership would transfer to my husband and I upon the death of the last surviving original owner (my in-laws).
Re: Foreclosure with Survivorship Deed (Still Living)
Do you have a copy of the deed? Post who the grantees are if you do. Just change the names to protect the innocent.
Re: Foreclosure with Survivorship Deed (Still Living)
You've lost me. A survivorship deed doesn't mean what you say. A surviorship means that those listed all have an ownership interest that transfers to the survivors in case any of them die. Still it would be very strange that a mortgage or deed of trust could encumber property without the signature of all the joint owners.
However, if there is a valid security instrument (mortgage, deed of trust, etc...) it matters NOT what the deed says. The foreclosure suit will be against all with ownership interest, and all will lose it through the foreclosure.
Re: Foreclosure with Survivorship Deed (Still Living)
Thank you. I was unaware of how a survivorship deed worked. I appreciate everyone's time.
Re: Foreclosure with Survivorship Deed (Still Living)
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flyingron
You've lost me. A survivorship deed doesn't mean what you say. A surviorship means that those listed all have an ownership interest that transfers to the survivors in case any of them die. Still it would be very strange that a mortgage or deed of trust could encumber property without the signature of all the joint owners.
However, if there is a valid security instrument (mortgage, deed of trust, etc...) it matters NOT what the deed says. The foreclosure suit will be against all with ownership interest, and all will lose it through the foreclosure.
I think she means a TOD deed not a survivorship deed. However, she does really need to figure out exactly what it is and tell us or we are not going to be able to give her any kind of valid information.
I am not sure that I agree with you about the foreclosure. There are two houses on the land and the land is not even partially owned by the mortgagees. Unless the parents signed away their rights at the closing, the land could NOT have been included in the mortgage. You cannot mortgage something you do not own without the approval and signature of the person who does own it.
Re: Foreclosure with Survivorship Deed (Still Living)
When we signed the mortgage papers, only my husband and I signed. My deed (which is at my house - I'm at work right now) states Survivorship Deed at the top. I do not recall any specific verbiage other than that. I will get the deed this weekend and re-read over it so that I may help you to help me.
Re: Foreclosure with Survivorship Deed (Still Living)
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llworking
I am not sure that I agree with you about the foreclosure. There are two houses on the land and the land is not even partially owned by the mortgagees.
The above makes absolute no sense. Property is typically not owned by mortgagees. Maybe you mean the land is not owned by the mortgager. (The lender is the mortgagee, the borrower is the mortgager).
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Unless the parents signed away their rights at the closing, the land could NOT have been included in the mortgage. You cannot mortgage something you do not own without the approval and signature of the person who does own it.
This was exactly the point I was making. The security interest may not be valid if the actual owners didn't sign. You can't have a mortgage on an improvement alone, it goes with the land (unless we're talking about an mobile home or something not affixed).