Help with a mortgage question please!?
Okay, so me my wife and two kids decided to stay with my in-laws and fix up their place in hopes to continue on living there after they pass away , Alos they needed the help around the home, we fixed it up, that cost us about $50,000 and we just recently found out that there are two mortgages on the home still, one for just over a hundred thousand and another for 300,000 ,my in-laws have mortgage insurance for the $300,000 loan but not for the hundred and change loan also there may be some credit card debt no more than $5,000 that I ll have to take care of, I really don t want to lose this home after they pass ! what are my options? my credit is okay I have a credit score of 740 my wife is in worse shape because of student loans. thanks in advance for the information
- JuanBLv 712 months ago
Are you asking if you can get $100,000 mortgage one day when you inherit a house that is likely currently worth $500,000 or more when you have a 740 credit rating? Yes you can.
- Karen LLv 712 months ago
This is not a mortgage question. It's an inheritance law question.
When a person dies, all their assets go into their estate. Let's say it's Mr Brown. The Estate of Mr Brown now owns the house. The Estate of Mr Brown has to pay off the mortgage before Mr Brown's heirs can get anything from it. If the Estate of Mr Brown does not have other assets with which to pay the mortgage off, then the the house would have to be sold to pay off that mortgage, and if a sole heir wishes to buy the house then the heir has to come up with the money to pay off the mortgage. An heir's chances of being able to continue with Mr Brown's mortgage, if the heir doesn't qualify for a mortgage in his own name of that size, are very poor in Canada. If there is more than one heir, they have to be paid for their share of the house by the one who buys it.
Am I simplifying? You bet. I'm not an estate lawyer. And there are details that could matter quite a bit and I don't know them. I'd consult a lawyer if I were you and really wanted to know how things play out when someone dies, with all the facts of the mortgage, assets other than the house, the debts, the insurance, and the will, though it's up to your in-laws if they want to give you all that. They don't have to tell you any of it. If I wanted to make sure someone got my house in the most painless way possible for them, I'd also consult a lawyer to make sure the will was written correctly.
We don't have inheritance tax in Canada, at least not by that name, but there are probate fees. Most wills must be probated. in Ontario, it's roughly 1.5% of the total value of the estate. If your in-laws were able to borrow $400,000 on that house then my guess is that it's worth at least a million. The estate or the heir(s) must pay 1.5% of that amount before anything can change hands. There will also be other expenses, probably including a lawyer's bill of at least $5,000, probably more. Many lawyers charge a percentage of the value of the estate.
- Anonymous12 months ago
You don't inherit mortgages you would have to buy their house.
Canadians don't have a Garn-St.German law.
- GregLv 712 months ago
You wrote the question like you KNOW they are passing away soon. How can you make that assumption? You don't take care of their debts after they die, their estate does. Are there wills? How do you know that you inherit the house?