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Quitclaim the best way?

In 2006 I began paying the mortgage on my mother's house. I'm now looking into buying it from her and getting a lower interest rate on the mortgage. The situation is that when I graduated college, I decided to stay in the house and pay the mortgage payments for her, and she moved out of state. She has no plans to return to the house, and I would rather buy this one than look for a new house. If I've been reading correctly, it looks like we can do a quitclaim to transfer it to my name, and then I can refinance the remaining mortgage amount to get a lower interest rate. Is this correct? If so, will I need to stay with the same mortgage company, or will I be able to switch lenders? The last property appraisal valued the house about $65K more than what's left on the mortgage, so losing money doesn't seem to be a concern on that front. I want to make this advantageous for her, but I also don't want to lose what I've put in over the last 5 years. This seems the easiest way to do it. Is there a better way to do this that will be to both our advantages? by julie2_219_737 from Corpus Christi, Texas. Oct 31st 2011 Reply


Brad Cahoone (info@globalhomefinance.com)
#90 ranked lender in Texas - 1,042 contributions

Julie, Good afternoon. In TX it would not be a quit claim deed. It would be a Warranty Deed. You generally have to be on title for 6 months or lenders price you as a cash out and 12 to do a rate and term refinance. Sounds like we can show continuity of obligation with the canceled checks from your sole account. Would have to review. Give me a call and we can go over in detail. No you don't have to go with the current lender. You can go with anyone and most of the time if it is one of the mega banks you are better off going somewhere else. My number is below if you want to know more.Brad Cahoone - NMLS ID 184176Global Home Finance Inc - NMLS ID 316441 globalhomefinance.com972-724-3222 ext 227866-515-4097 ext 227 toll free972-692-7888 efax972-420-1999 land fax

Oct 31st 2011
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Wesley Cordeau (Wesley Cordeau)
#2 ranked lender in Texas - 3 contributions

Julie; Brad has a good answer below. Another suggestion would be to purchase the property from your Mother under a gift of equity (GOE) that she donates as the down payment. Under the GOE, most if not all lenders will require a 20% GOE since it's not an ams length transaction. The GOE amount will be determined by a new appraisal and the excess over the amount owed is the GOE. In this situation, you would possibly have to pay closnngs costs at closing if there was not enough GOE over the 20% to cover them.Good luck, hope this helps.Wes Cordeau

Oct 31st 2011
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Henry J Daniels, CMPSI, CMHS (HenryJDanielsNationalMortgage)
#13 ranked lender in Texas - 133 contributions

Julie, If your Mom is not expecting any money from the sale of the home you can simply buy it from her. Transferring the Deed and refinancing can get quite messy as noted here. A purchase would simply be much more straight forward and depending on your area you could finance all of the closing costs just like a refinance and bring little to closing. Quite frankly for the price you are noting I would try a Small Local Bank in the Corpus Christi area. The will offer you the most options. Henry J Daniels - Sr. Mortgage Banker NMLS #209419

Oct 31st 2011
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Jerry Holcomb (TXMortgageGuy)
#91 ranked lender in Texas - 6 contributions

Hi Julie:Since you are not on title right now this is a purchase finance. According to the equity available your mom can gift it to you to cover down payments and even closing cost if possible.There is no difference for you to go the Refi or purchase route as far as interest rates, I need a bit more information and can tell you exactly how to make this work out. Remember your credit, Debt to income, Loan to value are the main things that set interest rates.Give me a call at 972-827-7890 or e-mail Jerry@DallasFHAloans.com

Oct 31st 2011
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Joe Metzler (JoeMetzler)
#2 ranked lender in Minnesota - 3,852 contributions

You have two options: You can "purchase" the house using a "gift of equity" because you are a relative. Mom would gift you the down payment and closing costs. You need to write up a standard purchase agreement, and this would work immediately. Any competent loan officer can help you with the details. The second is what you are describing. Mom would quit claim the home into your name, and then as an owner, you could refinance. You must wait AT LEAST 6 months after the Quit Claim transfer before you could refinance. www.wi-mortgagebroker.com

Nov 1st 2011
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William J Acres (William_Acres)
#1 ranked lender in Arizona - 8,550 contributions

There's obviously several ways to get financing in your situation... you should contact a local mortgage broker not a bank and let him look at the inner details of your scenario. He can guide you to the right loan product for your particular situation. WilliamAcres.com

Nov 1st 2011
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