Hi All-

My mother-in-law recently divorced and in the process acquired a house and a mortgage she cannot afford. Fortunately my wife and I have been able to cover the mortgage, and are thinking we want to hang onto the place as a vacation home. (Beautiful spot tucked back in the hills of northern Az) Currently the mortgage payment is manageable for us (excellent credit and verifiable income easily meets typical requirements), but it is in the ex-husbands name. As a result we are unable to obtain any tax benefit from this expense. Is it possible to move the existing debt into our names and retain the same monthly amount?

I would appreciate any comments on how to deal with this....thanks

One option would be for your MIL to gat a FHA refinance with you as a non-occupying co-borrower. You might even get a better rate to help out. Another option would be to buy the home from your MIL as your second home, pay off the old mortgage and let your MIL pay you whatever rent she could afford as long as she lives there.

Your MIL can quit claim the property to you and you must refinance the mortgage with you as the borrowers - that is the only way to transfer the debt. There is no guarantee that you will get the same terms as the existing loan, most likely they will be different.

On a side note, your MIL's ex must of had a [censored] poor divorce atty. who allowed her to get the house without insisting that it be refi'd into her name. If she stops making the payments his credit will get burned.