Removing Non-Borrower From The Title

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Question:

On a residential mortgage, is it a compliance violation to ask for a co/joint owner to be removed from the title if they are a non-borrower on the loan?

Answer:

I cannot fathom why a lender would suggest such a thing! Customers A&B jointly own real estate. Customer A applies for a loan to be secured by that real estate, and is credit worthy.

You'll need to obtain both signatures on the mortgage/deed of trust in order to have a valid lien on your collateral. But you cannot have B liable on the note.

While I cannot cite chapter and verse indicating your request would be a violation, I can suggest that you might be treading where you ought not go.

First published on BankersOnline.com 2/17/03