Titles or Deeds

[mrblue55]

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

My wife & I purchased a house 15 months ago. We went to closing & though we were assuming the mortgage on the house. As it turns out, the bank never recognized the assumption & the insurance company didn't either (they immediately canceled the policy when I contacted them about a claim). My question is even though we've been making the monthly loan payments & the deed is in our name, are we responsible for the mortgage or could we we walk away & not be liable?

 

[LdiJ]

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

My wife & I purchased a house 15 months ago. We went to closing & though we were assuming the mortgage on the house. As it turns out, the bank never recognized the assumption & the insurance company didn't either (they immediately canceled the policy when I contacted them about a claim). My question is even though we've been making the monthly loan payments & the deed is in our name, are we responsible for the mortgage or could we we walk away & not be liable?

That is a really interesting question.

If the bank never approved the assumption then I do not understand how the lien got released in order for the deed to be transfered to your name.

I think that you need to get an attorney on this one to do some specific research on your deed and on the entire transaction. I would think that the possibility exists that either 1) you don't own the home and are not responsible for the mortgage, 2) that you do own the home, are NOT responsible for the mortgage, and the bank no longer has any collateral for their loan, or 3) you do own the home, are not responsible for the mortgage, but somehow the bank still has a lien on the property.

You need to find out which scenario is the case, and I don't think that message forum can help you do that.

 

[nextwife]

Your contract with the SELLER may have created a contractual responsibility to make the payments that is unrelated to your responsibility to their lender. Have an attorney review the agreement.

 

[justalayman]

Your contract with the SELLER may have created a contractual responsibility to make the payments that is unrelated to your responsibility to their lender. Have an attorney review the agreement.

that may be the case but if so, OP would be liable to the seller and not the lender. Any action the lender might take would be against the seller/named party in the lending agreement. Since the lender was not a party to the sale agreement (agreeing to transfer of liability for mortgage loan), the lender continues to have an agreement with the seller.

LdiJ:

the lien does not prevent a transfer of title. It is as simple as writing a deed and having it registered. That does not release the lien as the seller cannot sell anything more than they own which, in this case, would be a property with an encumbrance of the lien for the current mortgage loan.

Liens generally do not prevent the sale of real estate.


what I see as a huge problem is there is apparently some damage to the house now, or some action that would allow a lien to be placed on the house. If the OP would walk away from the property, they may have some added liability to the seller for that problem.

This is definitely something a lawyer needs to review, first hand.