How can I take over Grandma's mortgage if I have a credit issue?

2 answers | Last updated: Apr 12, 2017
Mischuck080808 asked...

We moved in with my grandma to care for her 7 months ago when the doctor said she could no longer live alone. She is still paying a mortgage on her house. She wants us to have it when she passes but due to some credit issues I am unable to finance it. We live in Illinois, can you tell me what will happen if she passes away before I can get my credit in order to purchase the home from her?


Expert Answers

Barbara Repa, a Caring.com senior editor, is an attorney, a journalist specializing in aging issues, and the author of Your Rights in the Workplace (Nolo), now in its 10th edition.

You are wise to be thinking and planning ahead in this situation.

Hard to give definitive advice here, unfortunately, without knowing more about how much remains to be paid on the home, how title is held, and whether your grandmother has specific estate planning documents in effect.

But the hard bottom line is that the mortgage passes along with the mortgaged property"”and the new owners must ultimately find a way to pay off that debt. And if your grandmother has voiced a preference that you next own the house, but has not taken tangible steps to ensure that wish"”such as transferring it to joint ownership or leaving it to you by will or trust, then you will have no legal standing to take it next, with or without unresolved credit issues.

Take heart: There are some very creative and forgiving approaches being applied to clearing credit records these days, but you may already be in the best position to know whether you qualify for any of them.

While you surely must have your hands full with caretaking duties"”and all the demands on time and psyche that involves"”if your grandmother's house is important to you, it would be well worth your time and effort to consult an experienced real estate lawyer or financial planner who could eyeball the documents and evaluate the realities involved.


Community Answers

Geo2015 answered...

I agree that Mischuck, like any heir in that situation, should be thinking ahead, and try to find the money to hire a good real estate lawyer to help figure out critical next steps... given low cash flow, as well as a poor credit score, that will derail a bank loan. A good estate lawyer is well worth the expense, to make sure everything stays on track!

A lot of beneficiaries and heirs who have similar issues with credit and finances will list a home for sale with a realtor ASAP after an elderly parent passes away and probate has been filed. And if the estate is in probate or in trust, heirs often use inherited real estate to get a loan on inheritance, to borrow against their inheritance, to get a nice sized probate real estate loan… for all sorts of purposes, to hire their own lawyer, or to invest in an immediate opportunity, to take care of an emergency, whatever…. once it’s been established that the heir or several heirs are to inherit the house or property.

Many middle class heirs, caught waiting on a long probate without a great income or large savings, will frequently decide to get a loan on property that is to be inherited, to borrow against their inheritance to get as large an inheritance advance, or inheritance cash advance, or probate cash advance, as they can – so they start researching estate loans, probate loans, probate advances, inheritance loans, trust fund cash advances or trust fund loans if there is also a trust involved, from one of the more established inheritance loan companies, estate loan or probate loan companies, that deal with extremely fast probate real estate loans or estate advances, large and small inheritance advance loans and inheritance advance assignments — and those heirs will submit, with blazing speed, inheritance cash advance, probate advance and probate loan applications to various online probate loan and trust fund loan companies that provide loans on inheritance, inheritance loan advances, probate cash advance funds, inheritance loans in advance, loans against inheritance, from well known established inheritance advance firms like www.heiradvance.com, or perhaps www.inheritancenow.com, or www.inheritanceadvance.com. This is a great way to get some immediate benefit out of an older home that will probably take some time to sell, and then often sell at steep discount anyway. Rather than sitting there and listen to low offer after low offer – heirs can at least use that probate property to generate a good sum of cash for themselves with an inheritance cash advance, a probate advance, probate cash advance, based solely on real estate. I'd say selling it off is often preferable to keeping a house like that, paying taxes every year, costly repairs plus frequently dealing with renter problems… But a decent sized cash windfall will often solve a lot of problems