"When the mortgage company finds out, and they will, when they discover, for instance, that the homeowner's insurance that has to be reported to the mortgage company is not in the seller's name, it's in your name, they're going to call that loan."
"When the lender calls the loan, the seller owes $320,000 in full, typically within 30 days. If the seller cannot pay, the lender forecloses on the property."
"Laurie's title does not protect her from that foreclosure because the mortgage lien is senior to her ownership interest. The bank gets paid first."
"They're going to foreclose on the house that you thought was yours."
Laurie believed she purchased a $1 million home, paying $750,000 upfront. However, the sellers retained a $320,000 mortgage, which posed a risk due to a due-on-sale clause. This clause allows the lender to demand full repayment upon property transfer. The lender is unaware of Laurie, and if they discover the change in ownership, they can call the loan, leading to foreclosure. Laurie's title does not protect her from this risk, as the mortgage lien takes precedence over her ownership.
Read at 24/7 Wall St.
Unable to calculate read time
Collection
[
|
...
]