Q: Does Regulation Z's Ability-To-Repay Rule to Certain Situations Involving Successors-in-Interest apply to me, in GA?
I am seeking clarification of the Application of Regulation Z's Ability-To-Repay Rule to Certain Situations Involving Successors-in-Interest, pertaining to Successors-in-Interest who do not have the title to a property. It is my understanding that this rule was intended to prevent predatory lending. I am feeling as if I may have experienced predatory lending. I was told that because I am a Successor-in-Interest, the mortgage servicer did not have to determine my ability to repay. But there were 4 other heirs. And I never had and still do not have the title to the property, when they approved my loan assumption and modification in 2016. I'm just trying to determine if this rule applies to Successors-in-Interest who have the title already, or not. I am trying to sell the property, and my realtor's attorney is wondering how I could have assumed the mortgage without having the title. It is still in my deceased mother's name. I thought the loan assumption would have transferred the title.
A:
Loan assumptions absolutely do not transfer title. You probably need a probate for that, but this is state-specific and you did not say what state the property is in. You also did not say whether the property is residential or not, and that matters too.
Lenders are all too happy to accept anybody who wants to agree in writing to pay a loan, whether or not the person assuming the loan is in title. You should have contacted an attorney before assuming the loan. An attorney would have told you that if you truly are a successor-in-interest of residential real property of a decedent, then you have no obligation to assume the loan and the lender is still obligated to send mortgage statement to you so that you can choose to voluntarily pay them in order to avoid foreclosure.
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