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  • Mortgage when one borrower has passed away

    Currently I have a property in joint tenant with a family member and a mortgage in joint names, unfortunately she passed away and upon reading the bank policy, I can only takeover the mortgage if I reapply for the mortgage in my own name.

    Is there a way around this? The problem is I am currently studying so won't pass the credit assessment, does this mean the bank can call in the loan and force me to sell the property?

    I have no problem covering my expenses and interest until I graduate, it's just that I went back to University and am caught at a time where I cannot show any income.

  • #2
    What happens to her share of the property? Is it now yours? Or passed onto someone else - if so what are their intentions?

    If you live in the property can you move out and rent it out? Or get in a flatmate - i.e. create an income?

    cheers,

    Donna

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    • #3
      Sorry to read your comment. You are under an obligation to disclose of course and a lender is under an obligation to assist you to keep you in your home. They cannot just call in the loan. I had a similar situation with a customer last year and the lender worked with them under 'hardship'. There are a number of options open to a lender including changing term, interest only and payment 'holiday'. Best to discuss with you lender directly and they will guide you, I've always found lenders will bend over backwards to assist as long as the customer makes the first move. I wish you the very best.
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      Financial Paramedics

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      • #4
        Thanks both, it's under joint tenancy so her share passed to me. It is currently rented and is positively geared, just that I doubt I can pass credit assessment when I am not currently employed as they have to assume I have living expense + tuition fee in terms of expenses.

        I have no problem meeting the ongoing obligation under the loan, will the lender be happy to transfer the mortgage into my sole name without a credit assessment?

        I am still waiting for the death certificate to be issued so I cannot contact the lender yet.

        Edit: It used to be the family home so the intention is to keep the property.

        Just to be clear, I don't need any loan variation, I just want the loan transferred into my sole name. It's currently under joint name.
        Last edited by Athena; 02-05-2022, 06:29 PM.

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        • #5
          Originally posted by Athena View Post
          Thanks both, it's under joint tenancy so her share passed to me. It is currently rented and is positively geared, just that I doubt I can pass credit assessment when I am not currently employed as they have to assume I have living expense + tuition fee in terms of expenses.

          I have no problem meeting the ongoing obligation under the loan, will the lender be happy to transfer the mortgage into my sole name without a credit assessment?

          I am still waiting for the death certificate to be issued so I cannot contact the lender yet.

          Edit: It used to be the family home so the intention is to keep the property.
          Hiya, the only person who can advise you is the bank officer once they complete their process.
          www.ilender.co.nz
          Financial Paramedics

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          • #6
            Originally posted by Athena View Post
            Thanks both, it's under joint tenancy so her share passed to me. It is currently rented and is positively geared, just that I doubt I can pass credit assessment when I am not currently employed as they have to assume I have living expense + tuition fee in terms of expenses.

            I have no problem meeting the ongoing obligation under the loan, will the lender be happy to transfer the mortgage into my sole name without a credit assessment?

            I am still waiting for the death certificate to be issued so I cannot contact the lender yet.

            Edit: It used to be the family home so the intention is to keep the property.

            Just to be clear, I don't need any loan variation, I just want the loan transferred into my sole name. It's currently under joint name.
            I assume you are sole beneficiary? why not just leave it as is? As long as payments are made the bank wont have an interest in you. If push comes to shove you change the ownership then?

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            • #7
              Originally posted by brokerman View Post
              Hiya, the only person who can advise you is the bank officer once they complete their process.
              I wonder if Athena is concerned about a possible negative and irreversible financier reaction? I would be. Best of intentions aside, the lender's hands might be tied by all the new rules and regs. That's a very real possibility. Some time back, I wanted to borrow $50k for 3 months.

              The bank manager said something like, "You've borrowed money like that before, repaid it early and I know you and I know you're good for the money, but my hands are tied by all the new requirements. I hate this business, now."

              Perhaps better to let sleeping dogs lie? A lawyer chat could be appropriate.
              Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

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              • #8
                Originally posted by Perry View Post
                I wonder if Athena is concerned about a possible negative and irreversible financier reaction? I would be. Best of intentions aside, the lender's hands might be tied by all the new rules and regs. That's a very real possibility. Some time back, I wanted to borrow $50k for 3 months.

                The bank manager said something like, "You've borrowed money like that before, repaid it early and I know you and I know you're good for the money, but my hands are tied by all the new requirements. I hate this business, now."

                Perhaps better to let sleeping dogs lie? A lawyer chat could be appropriate.
                Tend to agree, however the borrower is under an obligation to disclose, dats the rule!
                www.ilender.co.nz
                Financial Paramedics

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                • #9
                  Originally posted by brokerman View Post
                  Tend to agree, however the borrower is under an obligation to disclose, dats the rule!
                  I still suggest a legal beagle chat before doing anything.
                  Rules are for the guidance of the wise
                  and for the obeisance of fools
                  Want a great looking concrete swimming pool in Hawke's Bay? Designer Pools will do the job for you!

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                  • #10
                    Originally posted by Perry View Post

                    I still suggest a legal beagle chat before doing anything.
                    Yep, completely agree
                    www.ilender.co.nz
                    Financial Paramedics

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                    • #11
                      ^^ fortune favours the brave.
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