I recently built a house. The mortgage switched from construction to permanent in September 2008. However, my construction costs went waaaaay over, to the tune of $100,000 over (it's a long story, I had a lot of bad luck starting with a contractor disappearing with $40,000 in the very beginning). Anyway, I've maxed out my own credit cards and borrowed money from family members to finish the house. My current mortgage is $250,000 and the house appraised for $367,000 before it was finished; so I have a lot of equity. But, I can't refinance because my credit is shot due to the debt I incurred and I have a new job that doesn't make nearly as much $$ as when I got the construction loan (which even then was a no-doc loan). Because of the mortgage and all of the "little" payments to several different credit cards, I'm barely making it. I was wondering, if I added some family members to my deed (family members with good credit and good jobs), could we refinance the house into all of our names and get the equity out to pay off credit cards and the personal loans from the family members? I really need to think of a way to rectify this situation and combine all of the payments. Otherwise, I don't see how I can continue "making it" as it is.. .
PLEASE. Any ideas or help would be REALLY appreciated.
Thanks so much.

Absolutely. However, I strongly recommend that you have a separate, written agreement with the family members as to exactly what will be done with the money and the eventual ownership of the property. For example, will the family members be required to release their interest in the property when they've been paid back? Or will they be entitled to an eventual percentage of the profit (if any) when the property is sold? These are things you need to consider before you start giving them pieces of ownership.

In sum, yes, you can do it, but it would be a very good idea to see an attorney first.

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Originally Posted by LisaB4657

Absolutely. However, I strongly recommend that you have a separate, written agreement with the family members as to exactly what will be done with the money and the eventual ownership of the property. For example, will the family members be required to release their interest in the property when they've been paid back? Or will they be entitled to an eventual percentage of the profit (if any) when the property is sold? These are things you need to consider before you start giving them pieces of ownership.

In sum, yes, you can do it, but it would be a very good idea to see an attorney first.

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