Detailed Answer
Under Tennessee law, making mortgage payments does not alone grant you legal title to the property. A mortgage secures the lender’s interest, but title remains with the named owner on the deed. However, in certain situations you may gain an equitable interest through a resulting trust or a constructive trust.
1. Legal Title vs. Equitable Interest
Legal title resides with whoever signed the deed. The mortgage lien in favor of the lender (see Tenn. Code Ann. § 66-5-101) does not transfer ownership to the payer.
2. Resulting Trust
If you paid all or part of the purchase price or mortgage, a court may presume you did not intend to gift these funds. In that case, the court can impose a resulting trust, giving you a proportional equitable interest. Tennessee courts recognize this in cases where the title holder has no financial contribution but holds legal title in their name alone.
3. Constructive Trust
A constructive trust can arise if retaining full ownership in the named title holder would result in unjust enrichment. For example, if you and the deed holder agreed you would share ownership in exchange for your payments, and the deed holder later denies your interest, a court may impose a constructive trust to protect you.
4. Partition Actions
If you and the deed holder hold joint or equitable interests, you can file a partition suit under Tenn. Code Ann. § 66-26-101. A partition divides or sells the property and allocates proceeds according to each party’s interest.
Key Takeaway: Paying the mortgage alone doesn’t automatically make you an owner. To secure an interest, you need clear evidence of intent to share equity or formalize your interest in writing.
Disclaimer: This article provides general legal information. It is not legal advice. For guidance specific to your situation, consult a licensed Tennessee attorney.
Helpful Hints
- Always get ownership agreements in writing.
- Keep records of all mortgage payments and contributions.
- Consider adding your name to the deed if you intend to share ownership.
- Discuss potential equitable interests with the deed holder before making large payments.
- Consult a Tennessee real estate attorney early to protect your rights.