Q: I have a little bit of a unique situation here. We purchased a house in September 2011, in Minnesota. My fiancée’s great grandmother is the one who took out the loan on our house, but we only wanted her to co-sign for us.
At the time, it wasn’t a big deal. Anyway, she passed away two months later and now the house is part of her estate. There is a mortgage on the house for 8.5 more years.
I have made all the payments, taxes, insurance and utilities since the purchase. Is the house mine? I was told that we would have to go to court and prove that it’s our house and that our payments weren’t payments of rent. I’m not really familiar with real estate law. Can you help us.
A: Your situation isn’t unique. We get quite a number of letters like yours every year.
The first question is who technically purchased the home? You said that you “purchased” the home and your fiancée’s great grandmother financed it. You need to know whose name was put on the deed to the home. If your fiancée’s great grandmother’s name was the only name listed on the title to the home, she became the sole owner of the home according to the record books in Minnesota.
To avoid claims against people who have died, or other title problems, you can expect that land records should reflect the true ownership of each piece of property in question. If you were to obtain a copy of a deed from the local office that stores the land records, you’d be able to see who owns a particular property, and you can research the chain of title all the way back to the original grant of land.
In your situation, if the land records show that you are not on the title to the property, you then have to prove through other means any ownership rights you might have to the property.
You might need to show that you put the down payment for the house together from your own funds. You should have records that show that you paid the money for the purchase of the home along with the closing costs. If that money came from your bank account, you should have a paper record of all the transactions that went into the purchase of the home. You should also have a paper record of all the payments you made for the monthly expenses of the home. In a perfect world, you’d also have some written statement from the great grandmother that confirms your ownership of the home.
Let’s look at a worst case scenario: You didn’t pay any money towards the purchase of the home, the home is in your fiancée’s great grandmother’s name, and you made monthly payments to your fiancée’s great grandmother and then she made the payments to the lender, to the tax collector and to the insurance company. If that’s the scenario, you might be in deep trouble.
If you thought that you were buying the property and she was cosigning documents for you, didn’t you ever stop and read the documents to know what she and you signed? Did you ever ask questions? You should have.
If you had, or if you had hired an attorney to represent your interests, you’d have insisted on adding your names on the title with the great grandmother and you would have wanted to take title to the home as joint tenants with rights of survivorship. At her death, the home would have transferred to both of you automatically.
If her family knows that the home was intended for you and they are willing to help you out as she was, you should end up fine. The estate can transfer title to the home to you and your fiancée’s and you can someday refinance the loan and obtain a new loan in your name.
However, if the family is not supportive of your position, it will be your word against theirs and you’d better have good documentation to back your claim that the home is yours. Otherwise, we can foresee a situation where the family might think that you are taking advantage of the situation and that the great grandmother never intended on giving you the home.
At this point, you have to gauge and see what documents were signed and obtained when the home was purchased, what documentation you have to prove your ownership and how willing the family is to accept that you are the owner of the home.
You should also speak with a real estate attorney as soon as possible.