Parents Will and Home

[cousinmose]

What is the name of your state (only U.S. law)? Michigan

My parents will states that I will receive the home I live in upon their death. The home is valued at 200K with a mortgage balance of 130K. I paid the 70K difference. My parents have the loan in their name and I am not on the mortgage. However, I make all payments to bank for mortgage. In addition, will states I would receive 1/3 of their cash/stock assets. They also signed a quit claim deed for home to me 3 years ago.

My question is this: Upon their death, would their cash/stock assets (worth more than mortgage balance) pay the balance of the mortgage with Wells Fargo for the home first before distribution of the cash/stock to myself and siblings? Or, would I need to finance or pay off the mortgage with my own money or mortgage?

Thank you for your assistance.

 

[LdiJ]

What is the name of your state (only U.S. law)? Michigan

My parents will states that I will receive the home I live in upon their death. The home is valued at 200K with a mortgage balance of 130K. I paid the 70K difference. My parents have the loan in their name and I am not on the mortgage. However, I make all payments to bank for mortgage. In addition, will states I would receive 1/3 of their cash/stock assets. They also signed a quit claim deed for home to me 3 years ago.

My question is this: Upon their death, would their cash/stock assets (worth more than mortgage balance) pay the balance of the mortgage with Wells Fargo for the home first before distribution of the cash/stock to myself and siblings? Or, would I need to finance or pay off the mortgage with my own money or mortgage?

Thank you for your assistance.

You inherit both the house and the mortgage debt that goes with the house. The rest of their assets would NOT go to pay off the mortgage, but would be divided evenly between you and your siblings.

However, you would not need to refinance or pay off the existing mortgage. You could simply continue to make the payments. The bank cannot call the mortgage when the home has been inherited by a family member, as long as that family member continues to make the payments in good faith.

 

[Stephen1]

What is the name of your state (only U.S. law)? Michigan

They also signed a quit claim deed for home to me 3 years ago.

Where does the quit claim deed fit into this? To me it sounds as though OP gained the house 3 years ago while the parents retained the mortgage which was tied to property they no longer owned. I'm sure the bank would have had something to say about that had they known.

 

[justalayman]

You inherit both the house and the mortgage debt that goes with the house. The rest of their assets would NOT go to pay off the mortgage, but would be divided evenly between you and your siblings.

However, you would not need to refinance or pay off the existing mortgage. You could simply continue to make the payments. The bank cannot call the mortgage when the home has been inherited by a family member, as long as that family member continues to make the payments in good faith.

He does not inherit the house. He already owns if via the QC deed 3 years ago.

 

[justalayman]

Where does the quit claim deed fit into this? To me it sounds as though OP gained the house 3 years ago while the parents retained the mortgage which was tied to property they no longer owned. I'm sure the bank would have had something to say about that had they known.

Why is that? Per the Garn st. Germain act a transfer to a child cannot invoke a due on sale clause.