Hello /r/PersonalFinance. I read here a lot, never have posted here.
As the title states, my grandmother (mom's mom) died last week and she was the cosigner of my mortgage loan. I bought my house in 2007, so I've owned it 10.5 years. My grandma did no live with me, nor did she make any payments on my loan, strictly the co-signer. She had four kids, my mom, and three others. All that is left in the estate is cash money, as the house was sold long ago. Most of the furnishings are in my mom's garage as none of the other siblings came in to help pack up the house. Anyway, my Aunt is POA and has stated the estate cannot be closed and dispersed as my mortgage shows as a debt to the estate, since my grandma co-signed.
My balance is right around $49,800 @ 6.25% and it matures 08/37. Monthly payment is $633, but I pay $650. My real estate taxes and insurance are included in that payment. I still have mortgage insurance of $21/month in that $650 payment, as I'm just under the 20% payoff amount. Also, I have a second (downpayment?) loan that was originally ~$3,000 @ 8.25% and matures 08/2027, but that balance sits at $680. That payment is only $21/month but I usually pay at least $50 and no more than $75. The only other debt I have is a credit card with a $3,100 limit and a balance of ~$1,500. I only got this card because I needed to buy a few appliances in a short amount of time, due to them crapping out. Right now I just pay the minimum of $50 but sometimes will pay $75. Just depends on my income.
In 2013 I lost my job and signed up for the Save the Dream program and actually got approved. They paid my mortgage for 17 or 18 months. I don't remember exactly how much they paid as my monthly mortgage payment changes each year depending on tax valuation and if there was an escrow overage/shortage. At most they would have paid $12,000 and the program ended in Nov. or Dec. of 2014, again. I don't have the paperwork in front of me. Stipulations were that if I sold or refinanced my house, "if there is money left over" then I would have to repay the program based on their stipulations.
Stipulations were as follows:
Year 0-1: Repay 100% of funds granted
Year 1-2: Repay 80%
Year 2-3: Repay 60%
Year 3-4: Repay 40%
Year 4-5: Repay 20%
Year 5+: Repay 0%
Right now I'm in the 40% bracket I believe.
My income is not ideal. My job is 100% commission, which is extremely hard to budget. In 2016, I only made ~$21,000 as I was off work for 5 months due to two heart surgeries. However, in 2017 I only made ~$26,000 and was not off work at all. I'm a 1099 that does estimates/sales for a General Contractor, so I don't necessarily work 40 hours a week. When we are slow I work way less hours, but during busy months I'll work 40-60 a week, so I guess it evens out? My credit score is right about 750 according to Credit Karma, however much salt they carry. Also, I pay all my own taxes being 1099, which I'm sure many of you would already know. I do deduct my mileage, rather than actual expenses. Although, this year I spent $2,700 in repairs/new tires. I do have almost all of my gas receipts as well.
Anyway, I just waited to put all that out there to try and limit as many questions as possible about financial background, although I'm sure I'm missing something.
I figure my options would be as follows:
1.) Re-finance to remove my grandmother's name from the loan. I'm assuming this would have some tax implications as well as having to repay the Save the Dream program. I know my interest rate would be lower, however I'm not so sure I could get another co-signer if I needed one. Also, I'm not sure if I could afford the payment on a 15-year refi, and I don't really want to extend my loan another 30 years.
2.) Have the estate pay off my mortgage with my mom's share and then just give my mom money every month to pay her mortgage. I am assuming this would also have tax implications. She lives strictly on her Social Security, which I believe is less than $1,500/month
I think these are realistically the only two options I have and I would appreciate any information/knowledge/direction. I did post in /r/legaladvice but it was suggested to post here as I guess it's mostly a finance question.
Submitted January 01, 2018 at 12:03PM by MacaroniNJesus http://ift.tt/2Et0t7d
