Paying off Mortgage

Im in Pennsylvania

I am the cosigner of a mortgage with my now late father back in 1998. My brother and mother are still living in house. I left home back in 2001. But Ive never paid the mortgage they have...anyway.

My mother has been saving her social security disability which changed to social security upon age, shes now 76. The plan between the 3 of us, upon my mothers death we use her death certificate to access her savings to pay off mortgage. BUT with her death who sends final payment, who "signs" the last check. Or does the bank must split her savings between my brother and I and we equally pay off mortgage.

convoy71 said:

The plan between the 3 of us, upon my mothers death we use her death certificate to access her savings to pay off mortgage.

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That's fine in theory, but the money in her savings account will belong to whomever is designated as the pay-on-death beneficiary with the bank. Do you know who the designated beneficiary is? Does your mother know?

If you are not the designated beneficiary, you'll have no control over the money nor any say in what happens with it. If no beneficiary is listed, then the money will belong to her estate. If that happens, unless your mother has a will that expressly provides that money from her savings will be used for this purpose, then that money will be subject to the satisfaction of creditor claims and whatever her will says happens to her assets (and, if she doesn't have a will, then the money will be used to pay estate debt and then be divided in accordance with the applicable intestate succession law.

convoy71 said:

BUT with her death who sends final payment, who "signs" the last check.

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I don't really understand this question but trust that my explanation above is sufficient to cover both of your questions.

zddoodah said:

That's fine in theory, but the money in her savings account will belong to whomever is designated as the pay-on-death beneficiary with the bank. Do you know who the designated beneficiary is? Does your mother know?

If you are not the designated beneficiary, you'll have no control over the money nor any say in what happens with it. If no beneficiary is listed, then the money will belong to her estate. If that happens, unless your mother has a will that expressly provides that money from her savings will be used for this purpose, then that money will be subject to the satisfaction of creditor claims and whatever her will says happens to her assets (and, if she doesn't have a will, then the money will be used to pay estate debt and then be divided in accordance with the applicable intestate succession law.



I don't really understand this question but trust that my explanation above is sufficient to cover both of your questions.

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Wouldnt as oldest son as my brother and I both agree/accept as presenting her death certificate to bank to access her savings would grant me as beneficiary. My brother has talk to bank and seems a new account must be created for joint access even with myself or him involved without a death certificate. Dont want to go thru that hassle especially due to my mother is handicapped or vehicle transportation to bank.

convoy71 said:

Wouldnt as oldest son as my brother and I both agree/accept as presenting her death certificate to bank to access her savings would grant me as beneficiary. My brother has talk to bank and seems a new account must be created for joint access even with myself or him involved without a death certificate. Dont want to go thru that hassle especially due to my mother is handicapped or vehicle transportation to bank.

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Also about beneficiary paper work would have been my now late father...So I think the bank would have/should have to accept the beneficiary as us, my brother and I.

convoy71 said:

I am the cosigner of a mortgage with my now late father back in 1998.

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You can't legally maintain your position as a co-signer on the mortgage, IF the SIGNER is deceased.

Most lenders will have a clause in the mortgage covering the death of a borrower or co-signer.

If, as in your case, the borrower died, the estate of the deceased (your father) would become the new co-signer.

If the loan were to go into default, the bank could then take action against both the living borrower and the estate assets of the deceased.

Usually when someone dies, the person's estate is obligated to pay off all debts, especially secured debts (as in a mortgage).

If the estate doesn't have enough money, then you, as the cosigner, are on the hook for whatever debt remains.

Even if the estate has the money, the lender might pursue you to pay the debt.

The law in most states doesn't require lenders to collect from the borrower or the estate.

If it looks easier to get the money from you, it's perfectly acceptable to come after you first.

On another note, as co-signer you have a duty to report the death of the borrower to the lender.

It might be time for your mother to create a trust with the money she has been saving.

Don't be surprised that when you start poking around you discover that money is missing.

You might wish to walk away from the Titanic sailing blissfully towards a monstrous iceberg, or discuss your options with a trust & estate lawyer, or a real estate lawyer.

army judge said:

You can't legally maintain your position as a co-signer on the mortgage, IF the SIGNER is deceased.

Most lenders will have a clause in the mortgage covering the death of a borrower or co-signer.

If, as in your case, the borrower died, the estate of the deceased (your father) would become the new co-signer.

If the loan were to go into default, the bank could then take action against both the living borrower and the estate assets of the deceased.

Usually when someone dies, the person's estate is obligated to pay off all debts, especially secured debts (as in a mortgage).

If the estate doesn't have enough money, then you, as the cosigner, are on the hook for whatever debt remains.

Even if the estate has the money, the lender might pursue you to pay the debt.

The law in most states doesn't require lenders to collect from the borrower or the estate.

If it looks easier to get the money from you, it's perfectly acceptable to come after you first.

On another note, as co-signer you have a duty to report the death of the borrower to the lender.

It might be time for your mother to create a trust with the money she has been saving.

Don't be surprised that when you start poking around you discover that money is missing.

You might wish to walk away from the Titanic sailing blissfully towards a monstrous iceberg, or discuss your options with a trust & estate lawyer, or a real estate lawyer.

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As I said in the original post...I never paid the mortgage, my parents did. I just helped with utilities. I was a co-signer to help obtain the mortgage, once I got married 2-3 years later after I got the house and left, my parents still always paid the mortgage. The mortgage had my father and myself in paper. But even with my fathers passing 2 years ago, my mother continue paying the mortgage. In was NEVER in default. The question is the legal access to my mothers savings upon her death to pay off the mortgage in full, its possible my mothers bank account if it had a beneficiary would have been my father. Now again what Im asking is, how/who pays the the mortgage final "full" payment (we sure cant sign the check in her name) once my brother and I access my mother's bank account upon her death. Or does the bank simply split the money between my brother and I and we make equal payment mortgage paid in full.

convoy71 said:

The question is the legal access to my mothers savings upon her death to pay off the mortgage in full, its possible my mothers bank account if it had a beneficiary would have been my father.

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The bank holding the funds is the only entity that can give you an exact answer.

The general rule is that if you're not on the account (listed as a joint account holder), the bank isn't going to give anyone the money who shows up with a death certificate, especially if the account has a significant amount.

convoy71 said:

Now again what Im asking is, how/who pays the the mortgage final "full" payment (we sure cant sign the check in her name) once my brother and I access my mother's bank account upon her death.

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It would NORMALLY be paid by the estate through the probate process, which is why MOST people choose to do this another way.

If you seek EXACT answers, rather than "usually", "generally", "normally"; you should retain an attorney who will research the matter for you.

convoy71 said:

Or does the bank simply split the money between my brother and I and we make equal payment mortgage paid in full.

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You, your brother, or both of you could seek to be appointed as guardian(s) for your mother.

To pursue that option, I suggest you speak to an attorney.

convoy71 said:

how/who pays the the mortgage final "full" payment (we sure cant sign the check in her name) once my brother and I access my mother's bank account upon her death. Or does the bank simply split the money between my brother and I and we make equal payment mortgage paid in full.

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The bottom line is that the bank isn't going to allow anybody access to the account unless:

1 - One of you has court papers appointing you representative of the estate.

Or

2 - There is a beneficiary named on the account (or it's a joint account) and the bank will release the money to the beneficiary or the remaining joint account holder.

You really need to sit down with your mother while she is still alive and do some proper estate planning so you don't find everything frozen when she passes. Consult a probate lawyer if you have to. It'll cost you a lot less to plan ahead than it will to fix a mess later.

convoy71 said:

Wouldnt as oldest son as my brother and I both agree/accept as presenting her death certificate to bank to access her savings would grant me as beneficiary.

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Huh?

Nothing in your three follow up posts (to the extent they make any sense) changes anything I wrote in my prior response.