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RayAnswers, Attorney
Category: Estate Law
Satisfied Customers: 37027
Experience:  Texas lawyer for 30 years in Estate law
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My father is a Veteran with a VA Mortgage. He and I are

Customer Question

Hello,
My father is a Veteran with a VA Mortgage.
He and I are listed on the Deed has Joint Tenants with Rights of Survivorship.
The mortgage is between my father and the lender and it is assumable.
Please note that I am my father's Durable Power of Attorney and the Executor of His Will.
Here is my question:
If my father passes away, as the joint tenant and owner with rights of survivorship who currently resides in the home, will I be able to continue to make mortgage payments to the lender and not apply for a new loan? Based on the Garn-St. Germain Depository Institutions Act, the law spells out a number of situations in which lenders are specifically prohibited from exercising the due-on-sale clause. One such exception is where there is "a transfer to a relative resulting from the death of a borrower.
Since I am already list as the Joint Tenant with Rights of Survivorship, I believe that I am protected.
If my assumptions are true, due the downfall of the American economy, my father's goal is to enter into the VA Streamline Rate Reduction program at a 30 yr fixed rate of 2.875%/ 2.947% APR or less to lower the payments from the current 4.375% APR.
Please note that he just exercised his VA Entitlement last year when he refinance the home. Of course, as his POA, I signed all the paperwork including endorsing my own signature because the as evidence I am listed on the recorded Deed since 2008 as Joint Tenants with Rights of Survivorship.
Please note that both our Credit Score are excellent. His credit score is 765 and my credit score is 839.
I await your response.
Thank you for your time.
Submitted: 9 months ago.
Category: Estate Law
Expert:  RayAnswers replied 9 months ago.

Hi and welcome to JA. Ray here to help you tonight.

You are correct that once you take the property upon his death that the loan is assumable by you.As you state the Garn-St. Germain Act requires them to do so and allow you to assume the loan.You would be free then to seek loan modification as the surviving owner of the property.If you start this and father deceases you would be able to proceed.It looks like you have this started, hopefully you can complete it here even as the surviving owner.

I appreciate the chance to help you tonight.Please let me know if you have more follow up.Thanks again.

Expert:  RayAnswers replied 9 months ago.

The joint tenancy would avoid any need for probate in this situation.