DEAR BOB: About six years ago, my three siblings and I inherited our father’s four properties located in two states. Fortunately, all the properties are rented and producing good income. But we now want to sell these properties to take advantage of today’s excellent real estate market and values. However, the problem is we can’t find one sister. Last we heard, she is living someplace in India with a religious group. My brother made a trip to India to locate her, but he was unable to find her. She hasn’t communicated with any of us or her college or high school friends for at least five years. The last we saw her was at our father’s funeral where she seemed rather “spaced out.” How can we sell these properties without her presence? – Ruth R.
DEAR RUTH: I will presume title to the four properties was conveyed by your father’s estate in probate proceedings to the four siblings. Because the three available siblings want to sell, it appears you will need a court partition sale order allowing the property sales.
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Since the properties are located in two states, it will be necessary to obtain court partition orders in both states so the properties can be sold and the sale proceeds divided among the four owners. The share for the missing sister can be held in trust until she either reappears or is determined by a court to be dead. Of course, you will need the help of an experienced real estate attorney to coordinate all the legal details.
IS INTEREST-ONLY HOME LOAN A BAD DEAL?
DEAR BOB: We recently refinanced our home with a 10-year interest-only mortgage at 6 percent. As our FICO scores are 615 and 610, we didn’t have much choice. But this is a big improvement from the 7.5 percent interest rate we were previously paying. Do you think we made a mistake obtaining an interest-only mortgage? – Ken R.
DEAR KEN: No. You got a very good interest rate, considering your FICO scores, and interest-only payments are rock bottom with fully tax-deductible interest.
Most homeowners build far more equity from the market-value appreciation of their homes than they do from gradually paying down the mortgage balances on amortized loans.
If you plan to keep the home “forever,” the terms of your mortgage probably allow you to make additional monthly payments to be credited toward principal reduction. But there is no need to make principal payments on your interest-only mortgage if you don’t want to do so.
HOW CAN YOUNGER SPOUSE GET BACK ON HOME TITLE
DEAR BOB: I am 64 and my husband is 78. We are both retired and in need of more retirement income. When we looked into a reverse mortgage, which you often discuss, the lender’s representative said we could receive much more income if only my husband is on our home title. So I signed a quit claim deed. As a result, our monthly reverse mortgage income has allowed us to go from paupers to living very comfortably. But I am told that if my husband signs a quit claim deed to me for a 50 percent interest, then the reverse mortgage comes due. Is this correct? – Patricia T.
DEAR PATRICIA: Please check with your reverse mortgage lender for exact details. When your husband dies or moves out of the home for more than 12 months, the reverse mortgage principal and interest matures and becomes due.
The reason is the reverse mortgage is based on his age and life expectancy at the time it was originated. When he dies or moves out permanently, presuming you survive him, you could either refinance the house or sell it to pay off the reverse mortgage balance.
The new Robert Bruss special report, “The Whole Truth About Senior Citizen Homeowner Reverse Mortgages,” is now available for $4 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet PDF delivery at www.bobbruss.com. Questions for this column are welcome at either address.
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