Changing The Title To Your Home
REM #A670
By Ilyce R. Glink
Summary: A reader would like to add her bankrupt boyfriend onto the title of her home and writes Ilyce Glink for real estate advice. Ilyce suggests never adding someone to the title of a home without also having them on the mortgage.
Q: I need to know if putting my boyfriend on the title to my house will affect
my credit since he has been going through bankruptcy.
Also, what would be the best way to put him on the title?
A: My first question to you is why do you want to do this? Unless your boyfriend is also on the mortgage (which probably can't happen due to his bankruptcy), you are giving him half of the value of the house but none of the liability. If something happens, you could wind up owing all of the outstanding balance due on the mortgage but owning only half of the equity.
That's a potentially catastrophic financial move.
But to answer your question, putting him on the title shouldn't affect your
credit. It also will not improve his credit. The only thing that this may do
is trigger a gift tax issue, since you are, in effect, giving him half of the
value of the equity of the house. You are only allowed to give another person
up to $11,000 per year tax free. If you give anything above that, you may have
to provide some paperwork to the IRS documenting the gift.
A better option would be to keep title in your name until such a time that you
can refinance the property together. At least if you refinance the property
and put both your name and his on the mortgage, he will have a legal responsibility
to pay back the mortgage each month. At that time, you may want to execute a
quit claim deed, which will put him on the title of the home.
Before you do any of this, however, I urge you to walk through your options
with a real estate attorney and accountant or tax preparer.
NOTE: This column is distributed by Real Estate Matters Syndicate, PO Box 366, Glencoe, Illinois, 60022. This column may not be resold, reprinted, resyndicated or redistributed without written permission from the publisher.
Quit Claim Deed Transfers Property Taxes
Quit-Claim Deed Question
Deed in Lieu of Foreclosure Will Hurt Credit Rating
Refinancing A Balloon Loan
Dividing Up Real Estate After Divorce
Link to This Article
Like what you've read? Spread the word! You can link to this article
from your website by copying the following code and adding it to
a page on your website:
Copyright ©2001-2007. ThinkGlink, Inc.
All rights reserved. Reproduction of material from any www.ThinkGlink.com pages without permission is strictly prohibited.
Site designed by Walker Sands Communications
