My husband and I owned the home jointly, but my husband was the only person on the mortgage loan. My husband has recently passed away, and I am able to and willing to make the mortgage payments. Can the mortgage lender allow me to make the mortgage payments even if my name is not on the mortgage loan? Do I need to take a loan out in my name or can I just keep making the current payments? Can the lender force me to take a loan out in my name, even if I am wiling to make the current payments on the loan? Can the Lender foreclose on my home or ask for the balance of the loan immediately after informing them of my spouse's passing?
1 Answer from Attorneys
Great questions. A federal law governs this type of situation and allows a surviving spouse to continue making payments on the mortgage without triggering any "due on transfer" clause.
Note that in other types of cases a lender can force the person getting the house to take out a new loan. However for either a surviving spouse on title OR a relative occupant of the home, the lender should be stopped from exercising any "due on transfer" clause and all should be fine so long as payments are made in the ordinary course and the loan remains current.