How to Transfer a Mortgage to a Spouse
Transferring a mortgage to a spouse is a significant financial move. It is most commonly done during a divorce--if one spouse owns the mortgage but the other will receive ownership of the house through divorce proceedings, the mortgage must be transferred over.
Transferring a mortgage to a spouse is a significant financial move. It is most commonly done during a divorce--if one spouse owns the mortgage but the other will receive ownership of the house through divorce proceedings, the mortgage must be transferred over. In less common cases, one spouse not listed on a mortgage may qualify for a better refinancing rate than another--when this happens, the mortgage is transferred over in order to save money on refinancing. This process can be tedious, since mortgage companies are concerned about the status of these large debts and want to make sure they will still be paid even after a transfer is made.
Step 1
Contact your lender, if you have not already done so. If you are refinancing, then your lender might already be aware that you are looking to transfer the mortgage. Nevertheless, once you are ready to transfer the mortgage, your account manager or representative will have to fill out an application for your spouse, including information about her income, assets and money saved. The representative will then check the credit score of your spouse and confirm any employment and income claimed. Once this review is completed, you will be notified of the mortgage lender's decision regarding the transfer. If approved, you can proceed with transferring the mortgage.
Step 2
Provide any additional materials requested by the mortgage lender when approving your application for a mortgage transfer. Many times, this can include pay stubs from work, bank statements and investment statements, if applicable.
Step 3
Request a mortgage transfer and ask the mortgage lender to underwrite the loan under your spouse. Most mortgage lenders also want the house appraised and inspected to ensure that the value of the house is accurate.
Step 4
Sign the mortgage transfer paperwork to close on the deal. Both you and your spouse will need to sign these forms to confirm the transaction. You will also have to pay closing costs. If you are remaining married and simply transferring ownership, the payment may not matter. If you are getting divorced, you might want to have the payee of the closing costs specified in the divorce proceedings, although it is typical for the recipient of the mortgage to pay closing costs. These costs are simply the fees charged by a mortgage company to process your paperwork and transfer the mortgage.