My father is in the process of transfering the deed of a house to me. Is refinancing necessary?

LisaB4657

Yes, it is necessary to refinance. In reality you are purchasing the property, so the existing mortgage loan must be paid off so that the lien can be released. You can obtain a mortgage loan in your own name and use that to pay off the existing loan. The deed transfer can be done at the time you close on the new mortgage.

I suggest that you have this handled by a real estate attorney or title insurance company in your area.

Dr D

Lisa is correct, because such a transfer could trigger the Due on Sale Clause, provided that the lender is made aware that such a transfer has taken place. As long as the payments are made on time and you don't call them informing them of the change in ownership, you might skate by. Some Conventional loans do have a provision for assumption of the debt by a subsequent borrower, with qualifying. FHA loans can be assumed (with qualifying) by an owner occupant at a charge of about $500 + title fees. VA loans can be assumed (with qualifying) by an owner occupant or by a non occupant borrower at a charge of 1/2% VA Funding Fee + title charges. Check the papers on the loan to see what is permitted. If the rate on that loan is lower than prevailing rates, that might be the way to go.