Determining who owns a home in New York is not always easy. The majority of people are not familiar with the various forms of ownership or how the deed and mortgage interact. At the Moshes Law Firm we commonly see and help remedy the following situations: 1. Two spouses on the deed, but only one on the mortgage. 2. One spouse on the deed, but two on the mortgage. 3. One spouse on both the deed and mortgage.
Buying a home is a significant milestone and understanding the intricacies of ownership and financing is crucial. This guide delves into the relationship between the deed and the mortgage addressing the question of whether they need to match and exploring the implications of different scenarios.
Understanding the Deed and the Mortgage
Deed:
- A legal document that proves ownership of a property.
- Identifies the owner(s) and their interest in the property.
- Filed with the county Register’s Office for public record.
Mortgage:
- A loan agreement between a borrower and a lender.
- Secures the loan with the property as collateral.
- Outlines the terms of repayment, including interest rate and monthly payments.
Do the Deed and Mortgage Need to Match?
Generally, yes. The names on the deed and the mortgage should ideally match to ensure clarity of ownership and responsibility for the loan. However, there are exceptions and nuances to consider.
Scenarios Where the Deed and Mortgage May Not Match
1. One Spouse on the Deed, Both on the Mortgage:
- This can occur when one spouse has poor credit, impacting the interest rate.
- Both spouses are responsible for the mortgage, even if only one is on the deed.
2. Two Spouses on the Deed, But Only One on the Mortgage:
- This can happen when one spouse has a stable income and good credit.
- The spouse on the mortgage is solely responsible for the loan payments.
3. Name on the Deed but Not the Mortgage:
- This means you own the property but are not liable for the mortgage payments.
- You can still be affected if the other party defaults on the loan, potentially leading to foreclosure.
4. Name on the Mortgage but Not the Deed:
- You are obligated to make mortgage payments but do not own the property.
- This can arise when co-signing a mortgage for someone else.
Implications of Mismatched Deed and Mortgage
1. Legal and Financial Risks:
- Confusion over ownership and responsibility for the loan.
- Difficulty refinancing or selling the property.
- Potential legal disputes if the homeowner defaults on the mortgage.
2. Estate Planning Considerations:
- Mismatched names can complicate inheritance and estate planning.
- It’s crucial to ensure that your estate plan reflects the ownership structure of your property.
Resolving Mismatched Deed and Mortgage
1. Adding a Name to the Deed:
- Requires executing a quitclaim deed, transferring ownership interest.
- Consult a lawyer for guidance on the process and legal implications.
2. Removing a Name from the Mortgage:
- Typically not possible without refinancing the mortgage.
- Involves obtaining a new loan with the desired borrower(s).
While the deed and mortgage should ideally match, there can be exceptions. Understanding the implications of mismatched names and taking steps to resolve any discrepancies is crucial for protecting your ownership rights and financial interests. Consulting with a real estate attorney is recommended for personalized guidance and legal advice.
Additional Resources:
- Moshes Law, P.C.: https://mosheslaw.com/two-names-on-title-one-on-mortgage/
- Trust & Will: https://trustandwill.com/learn/deed-vs-mortgage
Disclaimer: This information is for general educational purposes only and does not constitute legal advice. Please consult with a qualified attorney for advice tailored to your specific situation.
I am getting a divoce, with a mortgage in my name only. What happens?
If the house was purchased prior to the marriage, it might be considered separate property and not be divided. It is usually always community property, though, if it was acquired during a marriage, regardless of whose name the mortgage and deed are in. Both spouses should reach an agreement in the separation agreement.
Who Is the Owner of the Home?
Homeownership is determined solely by the deed. If you are listed on the deed, but not the mortgage, you are an owner of the home. When you purchase a home, this is decided upon when the previous owner transfers the deed to you following the fulfillment of the mortgage contingency. A buyer should make sure that everyone who is supposed to be an owner is listed in the purchase agreement and conveyance document for the new house, usually both spouses.
Accurately determining the home’s owner is crucial for several legal reasons, aside from mental tranquility. If you have questions regarding ownership of your home, contact Moshes Law, P. C. today. Our experienced real estate attorneys can ensure that your legal right to your home is protected.
Title vs. Deed: Don’t Get These Legal Concepts Confused!
FAQ
What if the mortgage is in a different name than the deed?
What happens if you are on the deed but not the mortgage?
Can I put my wife on the title but not the mortgage?
Does it matter whose name is on the house?
What is the difference between a mortgage deed and a title?
The trustee holds the title in trust for the lender. On conversely, a mortgage deed involves just the lender and the borrower, a sort of tête-à-tête. Here, the title is held directly by the lender. So, when it comes down to “title vs deed,” the main difference lies in who keeps your house’s title while you repay your loan.
What is a mortgage & a deed?
Mortgage: This is the document that gives the lender a security interest in the property until the Note is paid in full. If the debt is not paid, then the lender can enforce its security interest by foreclosing on the property. Anyone who is on the Deed of the property being used as collateral must be on the Mortgage.
Do I need a mortgage if my name is on a deed?
To put simply, the deed is the legal document that proves who holds title to a property, while a mortgage is an agreement between a financial lender and borrower to repay the amount borrowed to purchase a home. Not all homeowners require a mortgage, and you do not necessarily need to have your name on a mortgage if your name is on a deed.
What happens if you have two names on a title deed?
When there are two names on a title deed, it means that there are joint owners of the property and each person owns an equal share of the property. The mortgage does not need to include both names to be valid. Even if the mortgage only lists one spouse, it does not affect the share of the ownership of the property.