The closing process is the final stage in the process of buying a home. If you have already scheduled your closing, changes can disrupt the process and affect your eligibility. Although you should not add another borrower to the mortgage, you can add an owner to the deed at closing. If an owner appears on the deed and not the mortgage, she will have ownership rights without the responsibility of repaying the debt. The mortgage assigns payment responsibility, while the deed conveys ownership.
Contact the Lender
Before attending the closing, you will want to confirm the lender does not have an issue with adding a name to the deed. Inform the lender that you will be the only party responsible for paying the mortgage, but want to add another owner. If your mortgage contains a "due on sale clause," it is best to add the additional owner at closing, instead of completing a quit claim in the future. A due-on-sale clause gives the lender the legal right to call the entire loan balance due if ownership changes hands. When you complete a quit-claim deed, you are transferring a share of your ownership to someone else, which can be enough for the lender to invoke the clause.
Decide How to Title the Home
Decide how you and the other owner will hold the property. It is very important that the deed correctly convey ownership interest. If you want the property to automatically pass onto the surviving owner after your death, hold the deed as joint tenants with rights of survivorship. If you want to each own a separate, undivided share of the property, choose tenants in common. With this type of ownership, each owner's share passes onto their designated beneficiary. You will not need permission from the other owner to transfer, gift or sell your share to someone else.
Complete the Deed
You will be the only one responsible for completing and signing the mortgage documents at closing, but you will want the other owner present at closing. Although the seller, known as a grantor, is typically the only signature needed on a deed, you and the co-owner will want to review the deed to ensure it is accurate and correct. Verify the spelling on your names, ownership interest, property address and legal description.
Record the Deed
When the deed is recorded at closing, the title company is generally responsible for recording the deed at the county recorder's office. Once a deed is recorded, it becomes public record. If you create your own deed at any time after the closing, you will need to record it yourself. The recording fees vary, depending on the location. In most cases, recording fees for deeds are around $20-$30 per page.
- Nolo: How to Take Title in Joint Tenancy
- Rocket Lawyer: Quit-Claim Deed
- Living Trust Network: Transferring Real Property to a Living Trust
- The Law Dictionary: Can I Legally Quitclaim Deed My Home to Another Person While I’m Still Paying Off My Mortgage?
- Realtor.com: Understanding the Closing Process
- Roberts & Roberts LLP: How to Add Someone to a Deed
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