Refinancing Required To Remove Name From Mortgage

Added January 19, 2009 by Ilyce R. Glink

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Summary: When you sign a quit claim deed, it removes your name from the home's title, but if your name is on the mortgage, you still have financial responsibility. To remove your name from a mortgage loan the loan must go through refinancing. A quit claim deed only change's a home's ownership, not its financing.

Q: I have a few questions regarding ownership of a home and the mortgage that was taken out to buy the home.

If someone signs a quit claim deed, does that also mean that person is no longer responsible for any loans against that property? If the person who retained ownership of the property then defaults on the mortgage, who is responsible for the loan payments?

How do you go about filing a quit claim that removes you from the responsibility to repay the mortgage?

A: A quit claim deed only removes you as owner of the property. It does not release you from the mortgage. It actually puts you in the worst of all worlds because you are still liable for the mortgage and yet you do not own the property.

The only way to get your name off the mortgage (and I'm assuming we're talking about you) is to have your former co-owner refinance the property. But since your former co-owner has now defaulted on the mortgage, he or she won't be able to do that.

And you can't either because your credit is still tied to this mortgage. You need to get involved now to see if you can salvage this situation. I suggest you speak to the mortgage lender and a real estate attorney. If you can't figure out how you're going to make these mortgage payments, you'll probably have to file for bankruptcy to wipe off the debt.

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