Can one take over payments and put the real estate in their name as owners

[Jimmy Rojas]

This is a hypothetical question , say a person is having real hardship and can no longer make the mortgage payments on their home, is it legal and can someone offer to take over payments and put the home into the new owners name, is the bank still involved in this transaction , does the new owner have to still qualify for that loan?

[Doug Smith]

It is legal to do, but as part of that mortgage, the lender almost always reserves the right to call the loan. Usually, the loan paperwork states that the loan needs to be paid off in full at the time the title is transferred. A loan is a civil contract and it only becomes criminal if you are defrauding the bank in some way. Sometimes, people will try to sneak the transfer past the lender and actively hide the transfer from the lender. Knowingly hiding the transfer from the lender to induce them to continue allowing the new person to make payments at the lower rate to a borrower that was not part of the original contract could technically be considered mortgage fraud, so simply be careful that you're not doing anything shady. If you're not hiding this fact from the lender and the lender simply allows you to continue with payments, whether by formal approval or by simply ignoring that you're now the one making the payments, then it's not fraud on your part, but you do run the risk of the lender calling the loan on you. It's a very, very grey area that has caused many arguments on this and other platforms.