6 Ways to Take a Name off a Mortgage (2024)

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Co-authored byClinton M. Sandvick, JD, PhD

Last Updated: October 11, 2022Approved

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   Obtain the approval and agreement of your co-borrower, to sell the property to a third party. Selling to a third party will remove your name (and your co-borrower’s name) from the mortgage, by paying off the debt. The sale can free both you and your co-borrower up to purchase your own home.

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   Determine your property’s value by consulting with a real estate agent. If your home is worth enough to cover your existing mortgage, it makes sense to sell the property. If you owe more on your property than it is worth, you can try negotiating a short-sale with your lender. In a short-sale the lender agrees to a sale of the property for less than the total debt, but it still releases you fully from that debt.

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   Hire a qualified real estate agent and accept an offer. A real estate agent will list the property for you. They will also assist you in negotiating with the buyer to an agreed upon purchase price. (Some people choose to sell the property themselves. This is called a “for sale by owner” sale.)

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   Seek out a real estate attorney to close the deal. The attorney can make sure the documentation is drafted properly. They will ensure you are no longer listed on the mortgage or the property records. Make sure you receive copies of these records to retain for your personal files.

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   Determine if the person staying on the mortgage can qualify to refinance the property. Refinancing of the loan by the other person will remove your name. The refinancing party must demonstrate, to a lender, sufficient income to pay the monthly payment and refinancing costs.^[1]

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   Apply for refinancing with existing lender. The refinancing party will need to submit an application for refinancing. They will have to attach items such as pay stubs, tax returns, credit card statements, bank statements and documentation of any other loan obligations. The lender will also check the person’s credit history and score.

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   Receive approval of refinancing. If the refinancing is approved, your lender will notify you both. At this point, it is advisable to seek out an attorney to close the deal. The attorney can make sure the documentation is drafted properly. They will also ensure you are no longer listed on the mortgage or the property records. Make sure you receive copies of these records for your personal files.

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   Seek out other lenders if your existing lender will not refinance. You can contact other banks and lending institutions to try to find another lender that will approve the refinance. Note that most lenders require similar documentation such as bank statements, tax returns and pay stubs, when evaluating refinance applications.

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   Contact your lender to request a Release of Liability. A Release of Liability is exactly what it sounds like. It releases one person from the liability of the mortgage and hence, removes that person’s name from the mortgage.^[2] The person staying on the mortgage will need to demonstrate that they can pay the monthly payment.

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   Submit documentation to the lender proving the financial status of the person staying on the mortgage. Typically, items like pay stubs, tax returns, and bank statements are submitted to show a person’s financial situation. The lender will also check the credit history and score for the person staying on the mortgage.

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   Receive the Release of Liability documentation from your lender. Read the Release of Liability thoroughly to ensure it releases you from liability for the mortgage. It is advisable to get an attorney to review the document. An attorney can also prepare and file property records transferring the property from you to the other person.

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   Contact your lender to see if it will negotiate a Loan Modification Agreement that removes your name. Many individuals who are having trouble paying their mortgage attempt to negotiate a Loan Modification Agreement with their lender. Such an agreement reduces their monthly mortgage payment. If the person staying on the mortgage qualifies financially, the Loan Modification Agreement can be written to remove your name from the mortgage.

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   Apply for loan modification. The person seeking loan modification should submit an application with documents reflecting their financial situation. Similar to applying for a refinancing or new loan, the lender will expect the person to show they can afford the monthly payment alone. However, as it is a modification, the person must also show a financial situation that justifies lowering the monthly payment.

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   Receive approval of loan modification. If the lender approves the loan modification, it will send a Loan Modification Agreement with the terms of the new loan. The payment on the agreement should be lower than the original mortgage.

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   Enlist the services of an attorney to review the agreement. The attorney will make sure it is drafted properly and that it takes your name off the mortgage. The attorney can also ensure you are no longer listed on the county’s property records.

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   Contact your lender to determine if it has an assumption of the loan option. An assumption of a mortgage is basically a “take over” of the entire mortgage by one person and removes the name of the other person from the mortgage. The person staying on the mortgage keeps the original interest rate, repayment period, balance and terms. Loans issued by the Federal Housing Administration and the Department of Veterans Affairs are generally assumable. Many conventional loans are not assumable. You can check with your lender to see if it is an option.^[3]

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   Ask the person staying on the mortgage if they would like to assume the mortgage. If that person agrees, have them gather documentation showing financial ability to pay the mortgage. Such documentation might include past tax returns, pay stubs, and bank statements.

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   Contact your lender to request an assumption. Follow the lender’s instructions on how to obtain an assumption. The person staying on the mortgage will need to send in proof they can pay the monthly debt alone.

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   Receive notification of approval of your assumption. If the lender approves the assumption request, it will send an assumption agreement. It is advisable to have an attorney review the document to ensure when executed, you are no longer on the mortgage. The attorney can also draft and file property records showing you no longer own the property.

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   Ask the other person on the mortgage (co-borrower) if they are interested in paying off the mortgage and owning the property alone. If so, they can pay off the mortgage and “satisfy” the loan. Since the original loan will no longer exist, neither person’s name is on it any longer.

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   Retain the services of an attorney to assist with pay off. An attorney can prepare proper documentation to ensure the mortgage is fully paid off. The attorney can also prepare and file property records to transfer the property to the other person.

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   Receive documentation showing the mortgage has been satisfied. You may receive the mortgage satisfaction document from your lender or your attorney. From your attorney, you should also receive property records showing transfer of the property to the other person.

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