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Legal How-To: Paying Off Someone Else's Mortgage

When it comes to giving a gift that might truly last a lifetime, paying off someone else's mortgage might be the ultimate present.

Video of a young tech entrepreneur paying off his parents' mortgage for Christmas last week has gone viral, The Sacramento Bee reports. Joe Riquelme, founder of the smartphone app Videoshop, posted the video to YouTube, where it has since racked up over 7 million views.

How can those considering paying off someone else's mortgage next Christmas (or any time before then) do the same? Here's a general overview of what you need to know:

Paying Off a Mortgage as a Gift

A mortgage is an interest in real estate held as a security by a lender for the repayment of a loan. Once any mortgages on a property are paid, a homeowner generally owns a house free and clear.

That's now the case for Joe Riquelme's parents, as seen in this video:

In Riquelme's case, it appears that he paid off the remainder of his parent's mortgage without their knowledge. Typically, this type of gifted mortgage payment can be accomplished by:

  • Researching the name of the mortgage company holding the interest,
  • Finding out the account number of the mortgage, and
  • Paying the remaining balance of the mortgage loan.

The name of a mortgage holder's lender, and the mortgage holder's account number, are generally publicly available at the county recorder's office.

Different Ways to Pay Someone Else's Mortgage

Aside from a gift, there are a few other ways you may be able to pay off another person's mortgage or help them get caught up on a mortgage that may be close to default:

  • Anonymous payment. You can make an anonymous payment in much the same way as Riquelme paid off his parent's mortgage, by finding the mortgage company and account number through public records and making a payment. To stay anonymous, you can make the payment using a money order mailed with no return address.
  • Assuming a mortgage. In some instances and in some states, it may also be possible to assume another person's mortgage, although this may depend on your own credit as well as the terms of the existing mortgage.

Need More Help?

Although you may have the best intentions in mind when looking to pay off another person's mortgage, it may be best to consult with an experienced real estate attorney before doing so, to make sure your money will be well-spent.

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