People's lives are constantly changing. Whether it be due to a divorce, a bad break-up, someone moving out of state, a death in the family or a business transaction, from time to time it becomes necessary to make changes to the mortgage loan on a piece of property. Sometimes this is an easy process; other times, it quite frankly can be messy.
Establish a reason for the change in the status of the mortgage. If the person you are taking off the mortgage is still alive, you need to retrieve a notarised letter from the individual stating that he is requesting his name to be taken off the mortgage and what the reasoning behind the change is. You may also need to establish a contract of sale from the group of owners to a single or different set of owners. A court order may also do the trick, depending on the mortgage bank's rules. If the person is deceased, you will need a copy of the individual's death certificate.
Talk with a representative from the mortgage bank to determine whether it is possible to have an individual's name removed from the mortgage. If the account is in good standing, it makes the removal of someone's name from the mortgage much easier.
Prove that the owners of the home still qualify for the mortgage loan without the individual being taken off the mortgage. You will have to show current pay stubs, bank statements, credit reports and retirement account information to determine if the loan will be granted. It may take a few days for the mortgage bank to determine whether to approve your request.
Go through closing like you did when you bought the property, only with the sale going from a party that includes one individual into the hands of a party that excludes the individual. The title must be signed over from the original group of mortgage holders to the new party. It is customary for the individual being removed from the mortgage to sign notarised documents or be present at the closing.
Hold on to a copy of the new mortgage and title that no longer includes the name of the person you took off the mortgage.