Posted by Natalie-VA on March 11, 2005 at 11:09:05:
You should consult an attorney familiar with taxes and probate.
It may be more beneficial for you to inherit this property instead of buying it from her. If you buy it from her, you may be creating a larger tax liability for yourself when you go to sell.
If your Mom needs the 50k, maybe she can take out a second mortage and then you make payments on both the first and the second mortgages. She gets her 50k, and then you can inherit the house later.
My Mom owns a home that both parents bought. My Dad passed away last year and I will be purchasing the home in 4 months once I pay down some debt. I have no down payment. I have some questions.
My Mom wants $50,000 net. FMV=$350,000 she is asking $250,000 she has an existing mortgage of $195,000. The mortgage is not assumable.
I wanted her to take out a second for her $50,000. Then maybe form a corporation with her and have her keep the existing mortgages, I would make the payments. I don’t know about gift tax, how do we avoid that?
I would like to be on the deed now so if something were to happen to her, the house would not be held up. (I am currently renting the home) We don’t know how to go about this…checked the archives…still unclear.
I don?t know much about this. Please suggest some creative options.
Posted by John Merchant on March 12, 2005 at 11:25:20:
Clearly it is time for you both to go see a local lawyer who has RE practice and get his/her help with this, and getting enough title into your name so you’ll be OK legally when Mom does die.
That lawyer will know how to get you sufficient title to survive Mom, yet keep you from getting blasted by taxes post-Mom.
Just understand the lawyer will be concerned about the Due on Sale clause in Mom’s mortgage, and that decision (as to whether Mom should deed part/all of her title to you now & whether that deed now would trigger that DOS now) is not one the lawyer will make.
That is, the lawyer will warn you & Mom, then you two have to decide if it’s a danger or not.
There have been many posts in last couple of years to the effect that such a deed is not presently triggering any DOS in any mortgages… unless the mtg. co. is already looking for an excuse to foreclose on a mtg going bad.