If My Brother & I Are on the Deed & He Paid Off the Mortgage, Who Owns the House?
- A mortgage is a legal agreement between a property owner and another party -- often a bank or lender -- in which the second party holds the rights to the property until the owner pays off the financial debt. A deed is a written legal document that shows the transfer of ownership for the property from one person or institution to another.
- A person may be listed as a co-borrower, a co-owner or both, though each title has certain rights entailed. If you and your brother are co-borrowers, you both share equal financial responsibility for the property. However, that doesn't mean you both have to make equal payments. The lender does not care who makes the payment, as long as it is made in full. Conversely, if the payments are not made, you both share the financial consequences such as a negative effect on credit and possible legal ramifications like foreclosure.
- A co-owner may be a co-borrower, but the two are not mutually exclusive. If you and your brother are both listed as co-owners on the deed to the house, you share equal rights to the property. However, if a co-owner is not listed as a co-borrower, he is under no obligation to make payments. No one person is no more obligated than the other to pay off the mortgage; if you are both on the deed as owners, you both own the house.
- If you are a co-owner, there are some legal ramifications that could occur if your brother were to encounter financial problems. As a co-owner, you share joint tenancy, meaning you own one-half of the house. This means if your brother were to have a lien judgment made against him, it could affect the property. A creditor could take a lien out on his portion of the home, which, if not settled, could result in the creditor taking his half of the sale should you decide to sell the home.