Lein on property

by Nancy

In 2007 my father passed away and my mother could no longer afford the home. It was suppose to go to auction several times, but within the last year the bank wrote it off and put a lein on the property. She does not live there and it is underwater and would never get what the leinholder wants. What would happen if she passes away? Does the house go into her childrens names and then are we responsible for the home?

Thanks for your help,

Comments for Lein on property

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Apr 20, 2012
Lein on property
by: Debtcollectionanswers


When your mother dies, assuming she still owns the home, her estate (The assets your mother owns) will go through the probate process and the creditors she owes money to will have a legal right to get paid out of the estate. If there is not sufficient cash in your mother's bank accounts to pay the debts, then the executor of her estate (She would have named this person in her will. If your mother has not written a will, she should do so right away.) will have to raise the cash to pay them by selling your mother's assets. If there is not enough to pay all the debts, you and your siblings are not legally entitled to pay them out of your own funds.

As regards your mother's home specifically, if you and your siblings want to keep it after she dies (and assuming she has left the home to you and your siblings in her will and not someone else), then working with the executor, you will have to keep making the mortgage payments on it. If you don't, the bank will foreclose on the home and take it back.

If you don't want to keep the home and want to avoid the costs and hassle of foreclosure, the executor can give the home back to the bank, after which the lender will sell it. Again, if the home sells for less than the balance due on your mother's mortgage, the lender cannot look to you and your siblings to pay that shortfall.

Although I have provided you with an overview of your options, I strongly urge to schedule an appointment with an estate planning attorney in your area. It will be money well-spent because the attorney will be familiar with the probate laws of your state, will take time to learn about the ins and outs of your mother's financial situation, and can answer your questions in much more specificity than I can, especially given that I am not an attorney. Also, if your mother does not have a will, the attorney can draft one for her together with any other estate planning documents and health care directives she may need. Consulting with an attorney now is very likely to save you time, money, and legal hassles later.

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