my husband has inherited his brothers home which still has a mortgage attached to it. We are trying to settle the estate and would like to keep the house. I understand that I can pay off the mortgage through the estate and then purchase it for $1.00. Is that true?
1 Answer from Attorneys
Thanks for your post. If someone inherits property, they do not need to "purchase" anything. Historically some people put $1.00 (or $10.00) in a deed as sort of place holders for consideration when no significant money was changing hands but that is not truly necessary. Instead, the Personal Representative deeds the property over to whomever inherits it under the Will. Maryland law exempts this kind of transfer from transfer/recordation taxes so long as appropriate language is included in the deed.
Whether or not the estate can pay off the mortgage will depend on whether there are sufficient other assets in the estate and what the Will says. Federal law will allow certain family members to assume a mortgage after the owner dies.
If an attorney is handling the estate they should be familiar with a Personal Representative's deed and how to go about this. If you do not have an attorney handling the estate you may wish to engage an attorney for this task of preparing the deed. You are welcome to call my law firm, or any other estate or real estate firm of your choosing in Maryland. A competent estate or real estate lawyer should be able to prepare such a deed with minimum cost and effort, assuming the right to inherit is clear.
While I hope the general information above helps, it doesn't substitute for getting specific legal advice on your situation.