Refinancing Loan

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Topic Author
plansimmer
Posts: 9
Joined: Mon Dec 26, 2022 1:09 pm

Refinancing Loan

Post by plansimmer »

I'm looking to refinance our house.
Dad and I are on the title deed. Dad is on the Mortgage. On the new loan I want to make sure only I will be on the mortgage. Will the lender require a signature from dad even though he will not be on the new loan?
Thanks for any advise!
alex_686
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Joined: Mon Feb 09, 2015 2:39 pm

Re: Refinancing Loan

Post by alex_686 »

Probably yes. Dependent on state law. You are offering your father's property as collateral for money being lent to you.
Former brokerage operations & mutual fund accountant. I hate risk, which is why I study and embrace it.
retireIn2020
Posts: 395
Joined: Sat Jan 04, 2020 6:13 pm

Re: Refinancing Loan

Post by retireIn2020 »

Yes, If your father is willing to quitclaim the deed over to yourself prior to the new loan, then it won't be required.
Retired as of July 2020
Topic Author
plansimmer
Posts: 9
Joined: Mon Dec 26, 2022 1:09 pm

Re: Refinancing Loan

Post by plansimmer »

Thank you very much both of you. It does make sense @alex_686 and thank you for the alternative @retireIn2020
Jack FFR1846
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Re: Refinancing Loan

Post by Jack FFR1846 »

I'm curious why you're doing this. DW's family operates very "old country" doing things like this, erroroneously assuming that this is how to pull one over on the government, thinking that when the older generation dies off that the younger generation inheriting will have to disclose the inheritance to the government and pay big taxes. The opposite is, of course, true. Doing this transfer at some point is going to require filing a gift form because the older generation is giving the house to the younger generation. You might say that who cares? because the federal limit of elevendy bazillion dollars will never be met. But in my state and a number of others, hitting $1,000,001 means that you just clicked over the cliff so that instead of the estate being untaxed, we're starting at just about $40k in tax for that one dollar slip. If instead, the house was inherited, the basis is stepped up and the heir could sell it and pay virtually no tax (tax on the cap gain from date of death till date of sale).
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Topic Author
plansimmer
Posts: 9
Joined: Mon Dec 26, 2022 1:09 pm

Re: Refinancing Loan

Post by plansimmer »

Jack FFR1846 wrote: Wed Jan 25, 2023 10:03 am I'm curious why you're doing this. DW's family operates very "old country" doing things like this, erroroneously assuming that this is how to pull one over on the government, thinking that when the older generation dies off that the younger generation inheriting will have to disclose the inheritance to the government and pay big taxes. The opposite is, of course, true. Doing this transfer at some point is going to require filing a gift form because the older generation is giving the house to the younger generation. You might say that who cares? because the federal limit of elevendy bazillion dollars will never be met. But in my state and a number of others, hitting $1,000,001 means that you just clicked over the cliff so that instead of the estate being untaxed, we're starting at just about $40k in tax for that one dollar slip. If instead, the house was inherited, the basis is stepped up and the heir could sell it and pay virtually no tax (tax on the cap gain from date of death till date of sale).
Thanks for this and I agree with your thought process.
We will file a gift tax so that the IRS knows.
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