July 30, 2015 in Mortgages

Dealing with hubby’s mortgage after death

Dear Debt Adviser,

My husband died and left behind a home with a mortgage payment. My name is not on the paperwork as a co-signer, but I do live in the house. This was on purpose. I was kept out of the mortgage so I wouldn’t be held responsible if something happened to my husband. Now something’s happened, and I’m not sure what I can do to keep the house. I have not told the mortgage company of my husband’s death, though I have been attempting to keep paying the bill. What should I do? Do you have any advice for paying a mortgage after the death of a loved one?

— Linda

Dear Linda,

I’m sorry to hear that your husband passed away. I’m doubly sorry that you’re now stuck in a financial bind. You’re not alone, unfortunately. Women tend to outlive men, yet many fail to plan for this eventuality.

In the best of worlds, your husband would have had mortgage insurance or a life insurance policy that would allow you to pay off or pay down the home loan. From the tone of your question, I gather this is not the case. Because of the potential complexity of your remaining options, I want you to meet with an experienced real estate attorney to help you determine how to proceed. Here are some options to weigh:

Make sure your credit is mortgage-ready. Get personalized purchase rates with your free credit report and score at myBankrate.

If none of these options works for you, you may need to face the possibility of selling the home. You could use any proceeds to find a suitable new property or rental. If your name is not on the deed and the home was not willed to you, then the proceeds of the sale would go to your husband’s estate. What happens from there would be up to the laws of your state.

Good luck!

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