Real Estate Law
Have Real Estate Law Questions? Ask a Real Estate Lawyer.
Hi! My name is Richard & I will be helping you today! It will take me a few minutes to type a response to your question. Thanks for your patience!
Jack....you can do with it what you want. There is no legal requirement that you use it as your principal residence. You have every legal right to rent the property. You did not sign the loan and any provision representing that it would be used as the borrower's residence made to obtain the loan was only an issue of intent of the borrower and does not relate to you. You do not need to refinance the loan as long as you make the payments on the loan as Federal law prevents the lender from calling the loan due to your inheritance. Specifically:
“12 U.S. Code § 1701j–3 - Preemption of due-on-sale prohibitions
(d) Exemption of specified transfers or dispositions
With respect to a real property loan secured by a lien on residential real property containing less than five dwelling units, including a lien on the stock allocated to a dwelling unit in a cooperative housing corporation, or on a residential manufactured home, a lender may not exercise its option pursuant to a due-on-sale clause upon—
(5) a transfer to a relative resulting from the death of a borrower;
Thank you so much for allowing me to help you with your questions. I have done my best to provide information which fully addresses your question. If you have any follow up questions, please ask! If I have fully answered your question(s) to your satisfaction, I would appreciate you rating my service as Good or Excellent (hopefully Excellent). Otherwise, I receive no credit for assisting you today. I thank you in advance for taking the time to provide me a positive rating!