My late mother left me her home, but the mortgage will make it difficult for me to pay my medical and living expenses. Should I sell?

I moved in to take care of her before she died, and decided to stay. I’m the only child, and my mother didn’t have a will, so I’ve put the house into a trust.

My mother also had other property she inherited, and it’s shared with her siblings. They are dividing the land, and I will get my mother’s share. 

The lender says I don’t have a financial interest in the home, because my name was not on the title. And my credit is barely fair. So I’m confused: Should I sell the house, and move onto the land my family is giving me?

I can afford the mortgage and utilities in the house, around $1,100 per month, and I don’t want to sell for sentimental reasons. But taking on the responsibility of this house means I will not be able to afford to pay my other personal bills, including medical bills, or any other upcoming expenses. 

I’m on a fixed income of $2,900 a month, and I have only worked full-time for two months due to medical reasons. But due to physical limitations I may have to switch to part-time, or resign from my job altogether.

What should I do?

Still Grieving 

The Big Move’ is a MarketWatch column looking at the ins and outs of real estate, from navigating the search for a new home to applying for a mortgage.

Do you have a question about buying or selling a home? Do you want to know where your next move should be? Email Aarthi Swaminathan at TheBigMove@marketwatch.com.

Dear Grieving,

I’m truly sorry for your loss. I’m sure your bond with your mother was both cherished and strong.

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As for the house: You didn’t say how much she still owed on the home. If she didn’t owe too much on that home, and won’t entail you paying the mortgage for many years to come, then you should consider staying.

There’s nothing like living in a house that’s free and clear. Plus, this home holds sentimental value to you, and once you sell it there’s no going back. You may also wish to rent out a room — or the house itself — until you can afford to live there.

If there’s a substantial sum still owed, talk to your lender, and see if they can help. You talk to your lender and put the loan in forbearance — meaning that you could explore pausing or lowering your payments. (An important caveat: Forbearance could hurt your credit score, among other risks.) You could also talk to a housing counselor in your area to help you on the specifics, or you could refinance if your mortgage has a high rate and bring down your monthly payments.

You mentioned the other option of moving to a parcel of land that you expect to inherit. To me, it feels like there are so many more unknowns with moving onto that land.

Is it developed? Does it have a built housing unit on it? What will the financial implications be of living on that land? Will you be happy with the location? Ask yourself these questions, and see if it makes sense to live there.

If you can sell, some of the pros include the fact that you’re going to get a financial buffer to help you with your bills. And if you feel confident that you’ll be able to live comfortably in the new place, then it makes sense for you to sell.

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But taking a step back. You said you don’t have “financial interest” in your mother’s home, per your lender. I suggest you reach out to an attorney to check this issue.

Geoffrey Kunkler, an estate attorney with the law firm Carlile, Patchen & Murphy in Columbus, Ohio, told me that it’s likely that since you are the only next-of-kin, the title vested to you, the moment your mother passed.

But “in most states, when dealing with real estate, probate is needed to formally update the title,” he added. Kunkler said he’s not surprised if the lender is saying they won’t deal with you.

After all, they just want that mortgage to be repaid. If you’re considering the refinancing route to lower your monthly payment — if, indeed, you can lower the rate — you can also transfer that mortgage to your name, so the lender knows you are planning to pay off the house.

Ultimately, I’d say please talk to an attorney or someone who specializes in estate law to know your rights in your state, and consider taking the proper steps to live in this home. As the home holds so much value to you, you’re likely better off keeping it than selling it.

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