| What shall I do with this property? |
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RandRmoney
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| What shall I do with this property? |
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I am the administrator of my deceased father's estate. His home in N.C. is worth about 75k but the balance of his mortgage is like 120k. Are there any programs out there to correct this situation?
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Mon Dec 19, 2011 2:17 am |
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oldguy
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Normally the estate sells the house for the $75,000 and pays off the $120k loan with the $75k plus other funds in the estate. If the estate doesn't have $45k of additional assets, that part of the loan is forgiven. Ie, you, as a relative, will not be held responsible for the debt of a deceased.
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Mon Dec 19, 2011 5:40 pm |
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RandRmoney
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| Thanks |
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But as the administrator of the estate I have the option of keeping and maintaining the house, correct? I am exploring options of renting out the house until the market picks up.
Also, aren't there programs out there that help people in upside down mortgages?
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Mon Dec 19, 2011 6:26 pm |
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oldguy
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Yes, you can keep it and rent it. That's probably what I would do (I'm a landlord), I would keep it, rent it out, and sell it in a decade or so. That way your renters will be paying the loan for you - and the house most likely will go up in value, maybe by 50% or so.
As for prorams that help upsidedown loans - the new (2 week old) program lets you refinance the loan at a lower interest rate, but it doesn't lower the loan amount. And the programs are for personal residences only, not for investment properties. So you'll probably need to keep the loan that you have.
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Mon Dec 19, 2011 7:52 pm |
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littleroc02us
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Old Guy, doesn't he have to pay off the 75k before he can take the house from the estate???
Risk comes from not knowing what you're doing. (Warren Buffet)
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Mon Dec 19, 2011 10:26 pm |
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littleroc02us
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I just thought with estates that when someone dies, what he owns must stand for what he owes before anyone gets anything.
Risk comes from not knowing what you're doing. (Warren Buffet)
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Tue Dec 20, 2011 4:38 pm |
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Bibika
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Do you consider remortgaging or is this an option at all, since i did quite get if you are an administrator or an owner. Maybe remortgaging can allow you to rent the property and lower the mortgage cover expenses. Maybe that way you can start paying off the mortgage with the monthly rent and even make some money.
Just a thought..
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Thu Dec 22, 2011 11:19 am |
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eastmn
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In today's market the bank might just take 75K payoff, and call it even.
It may be worth a try.
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Thu Dec 22, 2011 7:25 pm |
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Offshore-Wealth.com
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Interesting,
Sadly, in this situation, there is a huge problem of $45K which will come out of the estate value, so you have a big decision to make. If you just let the bank take the home, it becomes and uncollectible balance, and by the time the bank comes after the deceased, the estate is settled and rarely will a bank come after balance owed after property is sold at auction.
I had a similar situation, and given most homes are upside down, I offered to purchase mortage from bank for less than owed, they refused to deal, so given the owner had no assets of value, there was nothing to come after, so it was decided to let bank foreclose since they were unwilling to negotiate a settlement. Their loss.
In this case, renting was not going to produce any positive cashflow in the long term, so your situation may be different, the point is, research all your options first, but unless there is a personal attachment to home, let it go and save the $45K loss.
Good luck,
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http://ENVIROPURELIGHT.com
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Thu Dec 22, 2011 9:39 pm |
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123akshay
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the best option would be renting it out...as it will fetch you money always....
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Thu Jan 12, 2012 11:39 am |
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tonybringa50
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i don't know about your properity
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Thu Jan 26, 2012 2:36 pm |
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dean40moore
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good tip for properity
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Fri Feb 24, 2012 5:03 pm |
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fast
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| Re: Thanks |
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quote:
Originally posted by RandRmoney
But as the administrator of the estate I have the option of keeping and maintaining the house, correct? I am exploring options of renting out the house until the market picks up.
Also, aren't there programs out there that help people in upside down mortgages?
This sounds like a nightmare in the making. What experience do you have as a landlord? Becoming a landlord because you want to become one is fine, but becoming one because it fell in your lap may not be a great idea.
Would you take out a loan for $120K for a piece of property that was worth $75K because you thought it might go up in value (oh say 50%!; that's $37.5K). It would be worth (what?) $112.5K!
What am I missing?
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Sat Feb 25, 2012 1:32 am |
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reeling
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don't sell it yet, Just wait for few months and I think you will get better price than what you are being offered right now.
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Sun Mar 04, 2012 10:13 am |
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devinclerk
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Depends on the loan. I do not think mortgages are assumable more, but at some point it was possible. Of course, this is not an attractive option in this case anyway.
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Fri Mar 23, 2012 1:37 pm |
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