Can You Remove Someone’s Name From A Mortgage Without Refinancing?
Yes, it’s possible to take sole responsibility for a home that you’re currently sharing without refinancing, even if your ex-spouse or another co-borrower or cosigner is currently on the mortgage. But there’s a difference between removing a name from your mortgage and removing someone’s ownership rights.
If two names are on the mortgage, both parties are financially responsible for repaying the loan — but it’s the names on the promissory note that determine who has legal ownership of the home. We’ll cover both how to remove someone’s name from a mortgage and how to transfer legal ownership, as well as when refinancing may be a better option.
3 ways to remove someone’s name from a mortgage without refinancing or selling
There are three ways to remove a name from your mortgage:
Note: Selling the house is another obvious way to remove both people’s names from a mortgage, but if one party wants to stay in the house, you’ll need to look at alternatives.
Refinancing may be the most straightforward way to remove someone’s name from a mortgage, but you may want or need to avoid that option. The main reason many people need alternatives to a refinance when looking to remove someone’s name from a mortgage is that they’re not confident they can qualify for a new loan with only their income and credit profile. Previously, the lender looked at both you and your co-borrower or cosigner to meet the minimum refinance requirements.
Taking a name off a mortgage vs. taking a name off a title
Obtain lender approval
If your lender wants to, they have the power to remove someone’s name from the mortgage without needing to refinance. However, many lenders have little motivation to release a co-borrower from liability or modify the loan to remove a name — after all, the more people who are liable for the debt, the less risky the loan is for the lender. Having a divorce decree (a document that describes how property is to be divided in a divorce) and a quitclaim deed (a document used to voluntarily give up one’s ownership rights) may make it more likely that your lender will cooperate.
Of note: If your sole motivation for avoiding a refinance is to bypass having a lender look into your financial situation, you should know that most lenders will evaluate your ability to keep up with future mortgage payments alone before they’ll release your co-borrower from liability.
Assume the mortgage
Mortgage assumption is a special type of transaction in which one person takes on or “assumes” responsibility for an existing mortgage loan. In the case of divorcing spouses or co-borrowers who are already on the mortgage together, assumption can release one person from the loan so that the other becomes the sole homeowner. Many conventional mortgages aren’t assumable because they include a due-on-sale clause, which allows the lender to demand that you repay them in full if the home is sold. However, most government loans and some conventional loans are assumable.
Declare bankruptcy
If the person whose name you want removed from the mortgage declares bankruptcy, their debts — including the mortgage debt — could be discharged, meaning that they no longer have to pay them. This could be a boon for you as their co-borrower, if your goal is to take sole ownership of the home without going through a refinance.
How much does it cost to remove someone from a mortgage?
It can cost anywhere from $0 to thousands of dollars to remove someone from a mortgage, depending on the method you use:
| Removal method | Cost |
|---|---|
| Lender approval | Free |
| Mortgage assumption | An assumption fee of 0.5% to 1% of the loan amount, plus closing costs. However, the closing costs on an assumed mortgage are typically lower than what you’d pay in a standard mortgage transaction (usually 2% to 6% of the loan amount). |
| Refinancing | Closing costs of 2% to 6% of the loan amount |
| Bankruptcy | • Free for the co-borrower who stays on the mortgage. • Free for the co-borrower who stays on the mortgage Several hundred to several thousand dollars for the person who files for bankruptcy |
Consequences of removing someone’s name from a mortgage
Removing someone from ownership vs. liability
When people refer to a name being “on the mortgage,” they’re often talking about multiple documents and concepts without realizing it:
→ The promissory note is the borrower’s promise to pay back the amount of money the lender has loaned them. It makes the borrower “liable” (legally responsible) for paying back the loan.
→ The mortgage is an agreement that the lender can foreclose on the house if they aren’t paid on schedule. In some circumstances, a deed of trust is used instead of a mortgage.
→ Title is often mistaken for a document, but is actually an abstract idea of legal ownership. Title can only be transferred by a deed, which is a document — it spells out who is the owner of a piece of real estate and is typically recorded in your local county clerk’s office.
Financial Liability | Financial Liability | Ownership |
|---|---|---|
Promissory note A promise to pay back the loan | Mortgage An agreement to give up the house if you don’t repay the loan | Title A legal concept, not a document; Can only be transferred via deed. |
Consequences for the person who will remain on the mortgage
- Higher mortgage burden. Once your co-borrower departs you’ll have to make mortgage payments all on your own. This could be a shock to your monthly budget, especially if your co-borrower used to contribute to the mortgage payments or household income. Make sure you’re prepared to take on the entire home loan yourself and, if you’re not, consider downsizing.
- Sole liability. Once you’re the only person left on the mortgage, you’ll be the only one liable for the loan. Only your credit will be on the line — a mortgage default could be devastating to your credit score, but won’t affect your former co-borrower’s credit.
- May still not have sole ownership. Removing someone from the mortgage doesn’t automatically strip them of ownership rights. The only way to transfer ownership of real estate — which is legally distinct from liability for the mortgage debt — is through a deed. In order to give up their rights, your co-borrower will likely have to file a quitclaim deed.
Use our mortgage calculator to calculate your estimated monthly payment with your sole criteria.
Consequences for the person whose name is being taken off the mortgage
- Freedom from any obligation to pay the mortgage. Once someone is removed from the mortgage, they’re free to move on financially: They’re no longer responsible for paying — or making sure that you pay — the mortgage. Late or missed payments or foreclosure won’t impact them.
- Lower DTI. Even if your co-borrower no longer lives in the home with you, as long as their name is still on your mortgage their debt-to-income ratio (DTI) will continue to include that mortgage debt, which could make it difficult or impossible for them to qualify for additional credit. Once they’re off the loan, they’ll have more freedom to borrow the money they might need to buy a car, send kids to college, start a business or take out any other sort of loan.
- May not lose ownership rights. As counterintuitive as it may seem, a person can get their name off the mortgage and still have some rights in relation to the property. This could be a good or bad thing, depending on your relationship with your former co-borrower. If you want to sever this final connection by fully transferring ownership to the only borrower left on the mortgage, you’ll need to file a quitclaim deed.
Could I qualify for a refinance?
If you’re trying to avoid a refinance, it’s important to be aware that refinancing may be far less arduous than you think. The requirements aren’t at all impossible for individual borrowers to reach; in fact single people own more than 19 million homes in the U.S., or about 23% of all the homes in the nation, according to LendingTree data.
Refinance requirements
A typical refinance — also known as a rate-and-term refinance — is a lot like taking out any other mortgage and will typically lower your interest rate or shorten your loan term. Here are the basic requirements by loan type:
| Credit score minimum | Loan-to-value (LTV) ratio maximum | Debt-to-income (DTI) ratio maximum | Income verification required? | Appraisal required? | |
|---|---|---|---|---|---|
| Conventional rate-and- term refinance | 620 | 97% | 45% to 50% | Yes | Yes, unless eligible for appraisal waiver |
| FHA rate-and- term refinance | 580 | 97.75% | 43% | Yes | Yes |
| VA rate-and-term refinance | No VA-set minimum, but many lenders require at least 620 | 100% | 41% | Yes | Yes |
High-DTI loans may have higher costs
Streamline refinances
A “streamline” refinance is a great option for those who are looking to refinance a government-backed loan. The process is quicker and easier than a rate-and-term refinance, since it requires no credit check, no home appraisal, and no income verification.
You can only use streamline options if your current mortgage is backed by the same government agency you’re looking to refinance with —in other words, you may be eligible for an FHA streamline refinance only if you currently have an FHA loan. Here are the basic requirements by loan type:
| Credit score minimum | Loan-to-value (LTV) ratio maximum | Debt-to-income (DTI) ratio maximum | Income verification required? | Appraisal required? | |
|---|---|---|---|---|---|
| FHA Streamline Refinance | No minimum | No maximum | No maximum | No | No |
| VA interest rate reduction refinance | No minimum | No maximum | No maximum | No | No |
| USDA Streamlined Assist Refinance | No minimum | No maximum | No maximum | No | No |
FHA streamline refinances require mortgage payment history
What happens if I can’t refinance or have my co-borrower’s name removed?
If you can’t refinance and none of the options discussed above fit your situation, you’ll need to explore alternatives while understanding that you may have to be patient and play the long game. Your co-borrower may continue to have rights to the house until you can reach a longer-term resolution—and that’s okay.
Alternatives to removing a co-borrower from a mortgage
In cases where refinancing or removing a co-borrower isn’t possible, homeowners have a few options.
- Find out the reason for not qualifying. If your refinance loan was denied, work with your lender to understand why. You can control some of the most important parts of your financial profile that affect qualification. For example, if your DTI ratio is the issue, you could choose to pay down your non-mortgage debt or, in the case of a divorcing couple, restructure the spousal support to increase qualifying income for the refinancing spouse.
- Wait to refinance. Delaying the refinance can allow time for the home value to increase, your mortgage balance to decrease or your credit score to improve. However, waiting to refinance does come with risks: Mortgage interest rates could increase, home values could decrease and, as long as both co-borrowers remain on the loan, late or missed payments will impact both.
- Downsize. Sure, downsizing is just a more friendly way of saying “sell the home,” but it can bring many benefits from easing the strain on your monthly budget to offering an opportunity to declutter and start anew. (And while you’re at it, maybe try out minimalism, a new home decor trend you love or the KonMari method.)
- Defer the sale. If you know that you want to sell, but the market isn’t great or you’re not ready to move — perhaps because you’re dealing with a divorce and want your children to be able to remain in the home for now — you can put off selling the home and continue to co-own the house with your ex. It’s a strategy that takes patience, but you’ll be better off for having waited.
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Frequently asked questions
The surviving spouse gains sole ownership of the home and sole responsibility for paying the mortgage.
No, taking one borrower’s name off the house deed — technically this is called “retitling” the house — doesn’t change the joint responsibility for the mortgage. Removing a spouse from the loan is a separate process that usually involves refinancing, but may also be achieved through mortgage assumption, bankruptcy or other legal processes.
No, you’ll need that person’s cooperation. In order to remove someone’s ownership rights to a home, you’ll likely need them to sign a quitclaim deed.
A deed is used to retitle, or transfer the ownership (also known as “title”), of a home. It typically takes about four to eight weeks to file and record a new deed.
Refinance closing costs typically run between 2% to 6% of the loan amount; however, this can vary depending on the type and size of the loan. Some lenders offer no-closing-cost refinance loans, which either roll the closing costs into the principal amount or have a higher interest rate.
Yes, loan assumption allows you to take over someone’s mortgage without refinancing or going through a traditional sale.