Profile picture for JuliaFly

My husband and I want to buy the property we live in from his Mother.

We live in my mother in laws rental property.  We love the house and want to buy it from her. The problem is that the home is worth about 100k

less than what her owes. We have been paying the full monthly mortgage payment for about 3 years and if we were to move out she would lose the home because the payment is more than she could afford and there is no way she can rent the home out for the aount we pay. We would love to buy the house just not for what she owes on it.  What can we do? i waht the property for the current market value. Will the lender shortsale the home? Will the lendar take her primary home because she has equity in it to cut their losses? How can we take the house off her hands with out hurting her financial situation. She wants nothing to do with it. Foreclosure is not an option.

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September 09 2008 - US
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Replies (11)

shortsale is not much better for your credit than foreclosure. for some reason, the myth that short sales don't hurt has become prevalent.

 

the only way you can buy the house for less than owed is shortsale. in most states, the lender cannot take her primary residence to make up the difference, unless she signed some sort of security agreement to that effect in order to get the rental property. (did she buy this rental for you to rent? what was the story there?) she should consult an attorney before doing anything.

 

you cannot take the house off her hands for less than is owed without hurting her financially. you cannot move out without hurting her financially.

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September 09 2008
Profile picture for Mr Caveat

talk strait with your mother in law. tell her that you want to help her out, and tell her that you need for her to help herself too.

 

my alternative:

 

buy the house for what it is worth, and have her quit claim the property to you. you agree to pay part of the mortgage and she agrees to pay the rest. you will get a reduced payment, her credit will be saved and you will get the home. also go to youtube and look up mortgage modification, you may be eligable for a reduction in principal balence if it is true that she cant afford to pay the mort, it is upsidown and the mort is ABOVE rent... take that info to the bank and they may be able to renegotiate with her without involving her credit rating at all. then you can talk again.

 

the mortgage is tied to THIS property, it is secured debt, even if she has both morts with the SAME lender, there is still no chance they will take from her her primary residence.

 

THERE IS NO WAY TO DO THIS WITHOUT HER BEING INVOLVED its in her best interest to be involved, i know she doesnt want to talk about financial stuff with you but these negotiations MUST be between her and her bank.

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September 09 2008
Profile picture for Mr Caveat

involve a lawyer in the contract between the two of you and do the bank part before the lawyer part

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September 09 2008
Profile picture for Mr Caveat

oh and if you want to help her out you might consider paying her an amount of money that exceeds the amoratized payment...

 

make your choice of lawyers a RE attourney experienced in short sales, and ask his advice...

 

and when i said "involve a lawyer in the contract between the two of you and do the bank part before the lawyer part"

 

i meant "involve a lawyer in whole process, and do the bank part before the contract part"

 

DONT DO ANYTHING BEFORE THE LAWYER PART ^_)^

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September 09 2008
Profile picture for greg1231

Why would the MIL have to quit claim the house to her son and DIL if they purchase the house? The poster should be careful about buying a house and paying 100K more than it is worth. MIL is in financial jeopardy already. If her son and DIL buy it at an inflated price, they may risk the same money problems. I do agree that the poster should speak with a lawyer, but I think buying this house is not a god idea.

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September 09 2008
Profile picture for Mr Caveat

if they buy the house for a price less than what is owed the bank will continue to hold the deed and they will effectively have been financed directly by the MIL. the house would still be in her name and therefore a quit claim gives the occupants claim without financing it through another bank...

 

yes, if you think your MIL will lose the house you need to be cautious because the bank could forclose on you even if you pay ontime.

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September 09 2008

I had our MIL come to us and ask for help... she needed us to buy some 'block' on a paper and we would get 5 times our money back once we sell 'blocks' to other people. We said no. She said she'd lose all this money. We still said no. She lost her money.

 

Whether it's a block or a house, does it really matter? If she works this out on her own, it will be HER best solution. Think about all the time you've been living there. If she sold the house back then, she wouldn't of lost as much as now. Honestly, it's still expected to fall further.

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September 09 2008

BTW, she never did sell a single 'block', so our decision was right.

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September 09 2008
Profile picture for Mr Caveat

cynic!

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September 09 2008
Profile picture for teck
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If she could never rent it out for what you pay then it sounds like you are already paying to much,

 

might be the smartest thing to move on and find another house

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September 10 2008

can't say it enough: LAWYER!

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September 10 2008
 
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