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On 3/24/2020 at 3:12 PM, kimanjome said:

... The bank can't foreclose if the surviving spouse lives there. 

Under federal law, the bank can foreclose when one spouse dies unless the surviving spouse assumes the mortgage.

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My brother in law had a reverse mortgage they were both on.  She died but the mortgage stipulates the surviving spouse can continue to live in the house.  I think this is probably the only case where the surviving spouse rule might exist.  Conventional mortgages NOB have to be paid regardless of whether one spouse dies or not or the bank can foreclose.

Not very applicable here, not too many mortgages here and what there are, are pretty expensive.

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Included in the US relief package was the legalization of "digital currency" . France is playing with the idea and Australia appears to be ready to go. The US petro dollar appears to be doomed due to inflation, and more "relief" packages coming down the pike, oil prices so low, national debt, etc. I am extremely concerned that the dollars I have in the bank will soon be worthless and I would rather own a home Lakeside than have dollars in the US banking system. One of the arguments is "paper money can carry viruses", but I am more afraid of an economic collapse than I am of the Chinese virus. In fact I am considering buying two homes, and sell one with owner financing. Any thought?  

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On 3/28/2020 at 12:05 AM, Lily H said:

Under federal law, the bank can foreclose when one spouse dies unless the surviving spouse assumes the mortgage.

Not in Florida and other Homestead states with protection written into the state law or constitution. The primary residence is untouchable. One reason why I like Florida as a primary residence location. https://www.alperlaw.com/florida-asset-protection/florida-homestead-law/

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7 minutes ago, kimanjome said:

Not in Florida and other Homestead states with protection written into the state law or constitution. The primary residence is untouchable. One reason why I like Florida as a primary residence location. https://www.alperlaw.com/florida-asset-protection/florida-homestead-law/

From the site you cited.  Mortgages are EXEMPT from Homestead Protection.  .  

Quote

Exceptions to Protection

There is an exception to the fraudulent conversion rule when the debtor obtained the money by deceit, fraud, or other egregious means and then used the money to purchase or improve the debtor’s homestead. A creditor may impose and foreclose an equitable lien on a Florida homestead if the creditor can prove that the debtor obtained money fraudulently or in breach of a fiduciary duty and then subsequently invested the same funds in a homestead property.

Other exceptions are written in the Florida Constitution. The most notable exceptions include:

Liens on the homestead voluntarily given to secure a loan such as the mortgage to purchase your home or a home equity loan

 

Here's a site that spells it out more clearly, https://richertquarles.com/probate-administration/florida-probate-overview-homestead-exemption-florida-probate-administration/

Quote

Conversely, if there is a mortgage on the homestead property at the time of the decedent’s death, the bank holding the mortgage will be allowed to foreclose on the mortgage in the event the payments are not made. The homestead is not protected from foreclosure. Therefore, if there is a spouse or heirs to the decedent to receive the property, the heirs or spouse will need to contend with the mortgage and the bank in order to take title to the property without foreclosure on the house.

 

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On 3/27/2020 at 8:46 PM, Honorandfaith said:

Kimanjome... Re: when a person with a mortgage dies... It's NOT "the bank's problem", it's the estate's problem. The house will pass into the estate, and depending on the testamentary structure, will go to an heir with a "stepped up basis" for tax purposes, but an encumbrance (a claim against the estate) at the same time, so the estate will be responsible for paying the debt/mortgage. 

Anybody that thinks that someone can get a mortgage, and then that debt just "goes away" upon death, is just stupid and selfish. Such a person should really think about the heirs, and put together a reasonable and clear estate plan. 

Those are good points. Yet, the people (seniors) with whom I have spoken don't care one iota about leaving an estate behind to anyone. The estate inherits the debt, the heirs don't.

I'm in Florida now and surrounded by geezers, many of whom I have spoken with about estate planning.  50% want to leave something to their children, while the other 50%--my parents are a great example of this--have no intention of leaving me or my sister anything  other than a few sentimental items of little monetary value.  They earned it, they saved it, they enjoy spending it while they are alive. When they pass on and the mortgage on the house and the car payments and the credit card bills are more than the value of the estate. so what? They are dead in their graves, not a worry in the world. My sister and I will be the ones to close out the estate (which is in the negative numbers)  but other than taking our time, we don't owe anything nor are we responsible for our deceased parents' debts--meaning, I won't have to go into my personal savings to pay off my parents mortgage. I did not co-sign on that, nor am I a guarantor.

Again, this mentality of NOT intending to pass assets onto the children is really common among the geezers here in Florida. I think the financial downturns in 2008/9 and the one now have a great deal of influence in the "live life now and to heck with the future" current attitude. 

 

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Where are you in FL? I also have a small condo there.

Just a word of warning... There is usually, in any type of líen, an "heirs and assigns" clause, that passes certain liens/encumbrances on to heirs and assigned beneficiaries, making  legally liable, so no, you are not able to walk away from any deficiency. Because of that, some basic but prudent estate planning is VERY IMPORTANT, for you if not for your folks.

If their estate wil be small, you might be able to get AARP to refer YOU to a cheap estate lawyer. Estate lawyers for small legacies are cheap. And you parents may not leave you money, but I am sure they don't want to leave you with heartaches. And I have seen many. 

There are guides for wills and trusts online, so you can all make a list of assets, deeds, bank accounts, etc, before you go into the lawyers office. You can sign a document called a "transfer upon death" at a brokerage, which keeps stocks out probate, and something similar at any bank accounts. Simple, saves headaches. And if thry have an annuity, there will have been beneficiaries named on it when they bought it. 

But every state's laws are different. Look online for FLs. As an executor of complicated wills and trusts in two states, and in the midst of making a new will in FL, I am re-learning all these little twists. 

If your parents die intestate in FL, their estate wil most likely still have to go through probate, and you will be responsible for the costs of that. Trust me, a simple will will save all of you big heartaches. Trust me. And don't do a DIY will. 

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