DEAR BOB: A few years ago I added my daughter’s name to the title to my home. At the time, I was very ill and she took good care of me. However, I recovered. She moved away from the area and is no longer close to me. I want to sell my home so I can afford to move into a lifecare retirement home, but she refuses to agree to the sale unless she gets half of the sales proceeds when my house sells. How can I take her off my title? –Ramon V.
DEAR RAMON: Sorry, there is no easy way to take your daughter’s name off the title to your home. As regular readers of this column know, it is usually a big mistake to add a prospective heir’s name to your home title before death.
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Such an act can be a disservice to both the homeowner and the heir, as you discovered. Now you have an ungrateful daughter who demands half of your home sales proceeds. Unless you can prove fraud, duress, or mistake in a court, there is no way to undo what you did by adding her to your title. For more details, please consult a local real estate attorney.
MORTGAGE LENDER MUST APPROVE PARTIAL PROPERTY SALE
DEAR BOB: My brother bought a home in February 2006. He has about a 1/4-acre of land, which a neighbor offered to buy for $15,000. Can he sell this portion of land without notifying the mortgage lender? Does he have to record the transaction at a title company? –Rod C.
DEAR ROD: If the house and vacant 1/4-acre are on one parcel lot, it will be necessary to subdivide the property so the 1/4-acre can be deeded to the neighbor. A local real estate attorney can advise what is necessary in the locality to accomplish this.
Presuming the entire property is the security for your brother’s mortgage, the lender’s consent to the subdivision and selling off the 1/4-acre will be necessary. To obtain the lender’s consent, the lender might require a partial pay-down on the mortgage balance. Or the lender can refuse to consent at all.
Your brother’s buyer will insist the deed for his 1/4-acre purchase be recorded in the public records. The buyer should also insist on receiving an owner’s title insurance policy to be certain he owns marketable title.
SHOULD BOTH SPOUSES NAMES BE ON THE HOME TITLE?
DEAR BOB: My husband is a “macho man” who insisted on taking title to our home in his name alone. That was 18 years ago, shortly after our marriage. We are just as much in love today as the day we married. However, he refuses to add my name to the title to our home. A lawyer friend says I should insist my name be added to the title to avoid probate if my husband dies first (he had a heart attack two years ago). What would my husband have to sign to add my name to the title to our home? –Evelyn C.
DEAR EVELYN: Your husband can sign a quitclaim deed from himself to himself and you. The deed should include the method of holding title, such as joint tenancy with right of survivorship.
Your lawyer friend can prepare the deed, which must be witnessed in front of a notary public so it can be recorded. When title is held in joint tenancy, after a joint tenant dies, all that is required in most states is for the survivor to record a certified copy of the death certificate and an affidavit of survivorship.
HOW TO SELL VIRTUALLY ANY HOUSE
DEAR BOB: I believe it was one of your articles where you wrote about how to get rid of a problem house. I own a two-bedroom, one-bath house that I have been trying to sell for several months. As I recall, you said something about running a classified newspaper ad telling folks to bring their checkbook. What is the secret? –Mark F.
DEAR MARK: The “secret” to sell virtually any “problem house” is to advertise it as a lease-option. Good times or bad, there are always more lease-option buyers than lease-option sellers.
Quick story: A few weeks ago, I was in Washington, D.C. attending a conference. During a break, in the men’s room, I couldn’t help overhear a young man talking on his cell phone (perhaps to a Realtor) explaining how to sell a house on a lease-option.
Later, he told me he lives in South Bend, Ind., where there are lots of foreclosed houses, which are hard to sell. We agreed lease-options are the best way to sell virtually any house. In fact, I bought my current residence on a lease-option.
My classic lease-option ad (change the numbers for your situation) says: “$5,000 MOVES YOU IN. Lease with option to buy. Open Sunday 1-3 p.m.” Then the ad describes the house, monthly rent, and gives the address. More details are in my special report, “How to Profitably Use a Lease-Option to Buy or Sell Your Home or Investment Property,” available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com.
SELLING A CONDO WITH A TENANT’S LEASE WON’T BE EASY
DEAR BOB: Should I sell my condo? Years ago, I purchased it for $282,003. Today, it’s worth $400,000. I lived in it for two-and-a-half years. Now I rent it to a tenant, but with a $700-per-month negative cash flow. Does it make sense to keep this condo if I’m losing money? The rental agreement expires in November 2006. –Maria G.
DEAR MARIA: Selling any house or condo for top dollar with tenants living in it can be extremely difficult. However, because your renter is your logical buyer, you should first ask your tenant if he or she wants to buy it. Also, then you wouldn’t have to pay any sales commission.
Unless your condo is appreciating in market value at least $700 per month to compensate for your negative cash flow, selling the condo makes good business sense. But don’t expect to get top dollar with that existing lease.
Unfortunately, your lease expires in November, one of the most difficult months to sell residences. December is even worse.
Today is a great time to be selling. However, anyone who buys your rental condo must honor the terms of the lease until it expires so your sale might be very difficult.
SELL INHERITED PROPERTY IF YOU CAN’T AFFORD TO KEEP IT
DEAR BOB: I am inheriting a house from my landlord. My property taxes and insurance will be exorbitant. I am disabled and on Section 8 subsidized rental. I will be kicked off Section 8 and also be paying more than I did as a tenant to meet expenses. My disability income is minimal. Are there any tax breaks for disabled or Section 8 homeowners? –Helen M.
DEAR HELEN: You must have had a very nice landlord who left you that house. However, if you are unable to afford to keep it, perhaps you should sell the house and live off your inheritance in a less expensive residence.
Because you will receive a new “stepped-up basis” to market value on the landlord’s date of death, you will owe little or no capital gains tax.
Homeowners are not eligible for Section 8 federally subsidized housing vouchers.
Depending on your disability status, check with the local property tax collector to see if you might qualify for any property tax reduction benefits.
CAN BUYER GET A REVERSE MORTGAGE TO BUY A HOME?
DEAR BOB: I thought I understood senior citizen reverse mortgages. But you had a recent item from a guy who wanted to buy a home with a reverse mortgage without first living in it. Is that possible? What do you mean by a “substantial down payment?” –Dan W.
DEAR DAN: You are referring to a senior citizen reverse mortgage for home purchase, offered by Fannie Mae. The residence to be purchased must be intended as your principal residence, not as a secondary or vacation home.
This special reverse mortgage program is ideal for seniors who want to “downsize” by selling their large home and using the cash proceeds to buy a smaller home and not have any mortgage payments.
Exact numbers will vary depending on the purchase price of the home, and the buyer’s ages, but a very general rule is a cash-down payment of 50 percent or more will be needed.
However, that’s a very good deal for senior citizen buyers who then won’t have any monthly mortgage payments. You can find Fannie Mae reverse mortgage originators at www.reversemortgage.org. More reverse mortgage details are available in my special report, “The Whole Truth About Reverse Mortgages for Senior Citizen Homeowners,” available for $5 from Robert Bruss, 251 Park Road, Burlingame, CA 94010 or by credit card at 1-800-736-1736 or instant Internet delivery at www.BobBruss.com. Questions for this column are welcome at either address.
(For more information on Bob Bruss publications, visit his
Real Estate Center).