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Why are there inconsistent names on mortgages and house titles

Making sure that you keep well-documented paperwork that is consistent is vital, especially when you are looking into investing in a property. You may be worried when you come to find that the mortgage bears a different name to the property title, and wonder what this means.

There are many logical reasons why a person may decide to choose to have the name on the mortgage different from the name on the house title. The following are some of the most common reasons why a person might have chosen this option as part of his or her investment strategy.

The homeowner would not have been able to qualify for the mortgage that financed it

If the homeowner wanted a mortgage but was dealing with unemployment or didn't have a high enough wage for the mortgage in question, he or she may have decided to pay for a mortgage under someone else's name, perhaps their parents' or partner's.

The homeowner has bad credit or went through a bankruptcy recently

In a similar circumstance, the homeowner may have been suffering from bad credit or undergone a recent bankruptcy. Therefore, the mortgage would not have been passed if his or her name had been on mortgage, although he or she is likely paying for it.

The homeowner wants to avoid the probate process after his or her death

If parents want their children to automatically inherit the home after their death, they may choose to put their children's names on the house title.

There are many reasons why there may be inconsistent names on mortgages and house titles. The reasons are usually due to strategic choices.

Source: Love to Know, "Name on House Title is Not on Mortgage Loan," accessed Jan. 31, 2018

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