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    kbiddy's Avatar
    kbiddy Posts: 1, Reputation: 1
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    #1

    Apr 5, 2013, 03:13 PM
    Who pays second mortgage death
    My mother was joint tenants with my grandfather on her deed. She passed away and my grandfather did a transfer to grandson of the house, so now the house is mine. My question is she had a home equity loan, who pays it? Do I let it go into collections and charge off? If I don't pay it can the house get foreclosed?
    JudyKayTee's Avatar
    JudyKayTee Posts: 46,505, Reputation: 4600
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    #2

    Apr 5, 2013, 04:42 PM
    It is against the law to transfer the property without the consent of any/all lienholders. Yes, the current owner of the property is 100% responsible for the line of credit/debt.


    Go into collections and charge it off? So you would walk away with the house free and clear? If this worked a lot of people would try it.
    ScottGem's Avatar
    ScottGem Posts: 64,970, Reputation: 6056
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    #3

    Apr 5, 2013, 07:23 PM
    The loan was secured by the property stays as an encumbrance on the property even if the signers die.
    Fr_Chuck's Avatar
    Fr_Chuck Posts: 81,280, Reputation: 7690
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    #4

    Apr 5, 2013, 09:19 PM
    Charge off is a collection term and only refers to tax status of property and not that the debt is not owed, Yes of course they may foreclose if the debt is not paid. In addition additional late fees, and interest will be adding.

    Legally most likely the transfer should not have taken place without this being paid or re-assigned. But yes you owe it now.
    ScottGem's Avatar
    ScottGem Posts: 64,970, Reputation: 6056
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    #5

    Apr 6, 2013, 05:17 AM
    Actually charge off is an accounting term. It means that the debt is charged off against income for tax purposes. It has nothing to do with the obligation to pay the debt.

    Secured debt is rarely charged off since the secured asset can be sold to, at least partially, offset the debt.

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