[WSBAPT] probate question - single spouse on mortgage

[MK Henderson]

Look at the Garn-St Germain Act following.12 U.S. Code § 1701j–3 -
Preemption of due-on-sale prohibitions
(d) *Exemption of specified transfers or dispositions*
With respect to a real property loan secured by a lien on residential real
property containing less than five dwelling units, including a lien on the
stock allocated to a dwelling unit in a cooperative housing corporation, or
on a residential manufactured home, a lender may not exercise its option
pursuant to a due-on-sale clause upon—
(1) the creation of a lien or other encumbrance subordinate to the lender’s
security instrument which does not relate to a transfer of rights of
occupancy in the property;
(2) the creation of a purchase money security interest for household
appliances;
(3) a transfer by devise, descent, or operation of law on the death of a
joint tenant or tenant by the entirety;
(4) the granting of a leasehold interest of three years or less not
containing an option to purchase;
(5) a transfer to a relative resulting from the death of a borrower;
(6) a transfer where the spouse or children of the borrower become an owner
of the property;
(7) a transfer resulting from a decree of a dissolution of marriage, legal
separation agreement, or from an incidental property settlement agreement,
by which the spouse of the borrower becomes an owner of the property;
(8) a transfer into an inter vivos trust in which the borrower is and
remains a beneficiary and which does not relate to a transfer of rights of
occupancy in the property; or
(9) any other transfer or disposition described in regulations prescribed
by the Federal Home Loan Bank Board.

Under 6 if the spouse takes by inheritance the spouse can continue paying
on the note. There is a question in your scenario whether the couple own
the home as joint with right of survivorship but if the spouse were to die
then the transfer of the remaining spouse could continue to pay on the
note.

On Sun, May 24, 2015 at 10:12 AM, Sharon Rutberg <email at sharonrutberglaw.com
> wrote:

> Hello, Listmates –
>
>
>
> Anybody out there this holiday weekend?
>
>
>
> Married couple owns a home as “husband and wife” on the deed, but mortgage
> is in wife’s name alone (she had the better credit).  They want to know
> whether, if she dies, he can “just keep making payments” on the existing
> mortgage. That sounds doubtful to me, and I’d like to understand what will
> happen. If she dies, will notice have to go to the mortgage company as her
> creditor? Will the husband (as PR) have to pay off the mortgage using
> estate funds, or could he refinance it in his own name?
>
>
>
> Thanks very much for your thoughts, and happy holiday.
>
>
>
> Best,
>
> Sharon
>
>
>
> Sharon C. Rutberg
>
> Attorney at Law
>
> 1718 NW 56th Street, Suite 304
>
> Seattle, WA 98107
>
> Website: www.sharonrutberglaw.com
>
> 206-409-2604
>
> email at sharonrutberglaw.com
>
> Washington State Bar #47055
> D.C. Bar #420576
>
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-- 
Mary K. Henderson
Henderson Law Office PLLC
1123 Maple Ave SW, Suite 225
Renton, WA 98057
206-650-2472
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