Davy Starwalker

If your mom dies with a 2.6% mortgage, her bank can tell you to refinance at 7.1% or lose the house My friend heard that 3 weeks after the funeral. Loan officer said "sorry for her loss" and asked for 2 years of W-2s She'd spent those 2 years out of work taking care of her sick mom Her credit score had dropped to 590 by then. 2 other banks denied her, and she got 60 days So she called me, because I'm known for buying inherited houses. The house was worth $330,000, with $265,000 left on the loan. I offered $285,000. She'd have walked away with about $20,000 and no house, and I'd have made about $40,000 Then I asked her to read me what the bank said, and I took my offer back Her mom's payment was $1,201. The new one would've been $1,781. That's $174,000 more over the next 25 years, for the same house Since 1982, federal law has protected transfers of homes to relatives after the owner's death. The bank can't call the mortgage due just because the house was inherited And since 2018, federal rules have required mortgage servicers to treat confirmed successors in interest like borrowers for servicing purposes She didn't need to qualify for a new mortgage just to keep paying the existing one. No new loan, no new interest rate, no 2 years of W-2s Same rate. Same payment. We asked for the successor in interest department, not the refinance desk, and sent this certified mail with the death certificate and the deed: "My mother, [name], died on [date]. I inherited her house at [address] and I live there. I am a successor in interest under 12 CFR 1024.31. Please tell me in writing what else you need to confirm me. I am not applying for a new loan" 5 weeks later her name was on the account at 2.6% You have to prove you're a qualifying successor, and you have to keep making the mortgage payments while they process it. The bank can ask for proof of inheritance. It can't automatically force you to refinance just because your mom died Send this to your siblings before one of you has to make that phone call That loan officer is telling somebody else's kid the same thing today