If your name is on the title but not the mortgage it means you own the property but are not liable to make payments on the mortgage. The bank can still foreclose on the property, but your lender will not hold you responsible for the payments.
- If you are on the title but not the mortgage, it means you own the property, not the loan
- You do own the house if your name is on the title.
- During a divorce, if you are on the title but not the mortgage your spouse cannot force you to leave.
Since most couples cannot buy a house without a mortgage the legal documents may get confused. Many people confuse the title with the mortgage. However, they are very different, and your name can be on the title but not the mortgage.
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What Does it Mean if My Mame is on the Title but not the Mortgage?
If your name is on the deed but not the mortgage it means that you have ownership rights, but you are not liable for the loan payments. The person who signs the mortgage is responsible for the loan repayment, but you can take on the liability for the loan without owning the property. The deed, then, is the legal document that shows who has ownership, or title, of the property. Can you own the property but not be on the hook for the mortgage? Yes, but here are some things to consider:
- If you don’t pay your mortgage, the banks will foreclose, no matter who the owner is.
- While a foreclosure may not directly affect your credit, it will severely damage the person who sings the mortgage.
The most common case where someone is an owner but not a borrower is a married couple with a spouse who has poor credit. In this case, the bank only looks at the credit and income of the spouse who signs the mortgage. That person takes responsibility for payments, while both partners live in the house together. If the couple cannot pay their mortgage, it impacts the spouse with good credit.
Can Someone be on the Title and not the Mortgage?
Yes, a person can be on the title and not the mortgage. As we said before, not only is it possible it happens with some regularity. Besides the case of one spouse having bad credit, there may be other reasons people may want to have a partner on the title but not the mortgage.
Another less common case is if one partner has uneven income because of a business, or no income at all. Even if they have good credit, it may be difficult or time-consuming to go through the process of validating income. It may simply not be worth the effort because the partners will not get better terms on the loan.
Does Being on a Deed Affect Credit
Being on a deed does not affect credit. The deed is the legal document that conveys the title and shows ownership. On the other hand, a mortgage is a loan. Not paying your mortgage on time will affect your credit. While the two documents go hand in hand for most people buying a house, they are two distinct documents.
Do I Own the House if my Name is on the Title?
You do own the house if your name is on the title. The title shows who owns the house. When you buy a house, the previous owner signs a deed and names you as the new owner. The deed conveys ownership, or title, over to you. You own the house with anyone else who is named on the deed, so if your name is the only one on the title then you own it by yourself. If you buy a house with your spouse, then both of your names are on the deed, and you own the house together.1
What Happens if Someone is on the Title but not the Mortgage?
If you are not on the mortgage, the bank does not hold you responsible for the payments. That much is straightforward. Ownership, on the other hand, can be tricky. If you are on the deed, you own the property, at least partially if anyone else is on the title with you. These rights include:
- Possession
- Control
- Exclusion
- Ability to derive income
- Disposition
In a nutshell, this means you can live in the house, do what you want with it (legally of course), and no one can take it away from you unless there is a lien. The mortgage company will put a lien on your house and foreclose if the loan is not repaid. They will not care whose name is on the title. If they do not get paid, they will foreclose and take possession of the house.2
Can You Sell a House if You are on the Title but not the Mortgage?
You can sell a house if you are on the deed but not the mortgage. The deed shows ownership and grants you all the rights associated with ownership, including disposition. However, you cannot sell the house without the consent of everyone named on the title. If you own the house with someone you all must agree to sell together. Also, you must pay off the loan to the bank. You cannot just ditch the bank.
If My Name is on the Title but not the Mortgage Divorce
Divorces are messy. They get even messier if a house is involved. As we said before, you cannot just sell the house without the other person’s consent. Also, the bank will get their money; they are very good at that.
You may have the fantasy where you sell the house out from under your ex (they deserve it), leave your ex on the hook for the mortgage (the bank and your ex both deserve it), take the money, and run. Rethink this. Your ex will sue you because they own the house with you, and you cannot sell it without them. They will win. The bank will sue you too because you must use the proceeds from the sale to pay them first. They, also, will win. Finally, you will likely go to jail too.
There are many ways to deal with the home during a divorce. One person may continue to live there if both parties agree to financial considerations. Both people may agree to sell the house. The key is that you must work together to deal with the home. You cannot act unilaterally.
Does it Matter Whose Name is on the House in a Divorce?
It does not matter whose name is on the house in a divorce if you bought it together during the marriage. It is marital property. However, a spouse who bought a house before the marriage may be able to claim it as separate, not marital, property. This gets complicated, though, if the couple lived in the house as their home.3
Who Must Leave the House in a Divorce?
One spouse cannot force the other to move out before the divorce is final because both spouses have equal ownership rights if they are married. Beyond that, the divorce agreement states the disposition of the property. After it is finalized, both parties must adhere to the dictates of the divorce.
Final Thoughts About Name on Title but not Mortgage
The important thing to remember is that the title and the mortgage are two different legal documents. The title represents ownership. The ownership of the title is conveyed, or handed off, by a deed. The seller signs the deed over to the buyer at closing.
A mortgage is a loan on the property. The bank puts a lien on the house when they agree to the loan. This lien guarantees that the owner, regardless of whether they are on the mortgage or not, cannot complete a sale until the mortgage is paid off. This usually happens at the closing, as well.
