Home Buying in Massapequa>Question Details

North Massap…, Home Buyer in Massapequa, NY

I am considering purchasing my first home from my mother-in-law. What would be the pros and cons to purchasing a home from a family member?

Asked by North Massapequa, Massapequa, NY Mon Jan 4, 2010

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Dear Home Buyer,

1. Get a certified appraisal to determine the value of the house.
2. Both the seller & the buyer should get real estate attorneys to represent them.
3. Get pre-qualified before making an offer.
4. Remember - this is a business transaction.
5. Be Fair - Make it a win-win situation for both parties.

Andy Yakubovsky
Century 21 Prevete
516-826-2000
0 votes Thank Flag Link Mon Jan 4, 2010
Pros---
You must already like the property if you are considering it.
Hopefully she is giving you a break on price since you are family; regardless, maybe you should have a CMA done to see if the price is realistic. Afterall, she could be doing this w/o the help of a realtor and saving ~6% brokerage fee.
Cons---
She never moves out and thinks she still owns it.
She comments or doesn't like the changes you make to make it your home.
Any issues that might arise may cause some resentment down the road.

If you are trully considering it, then you probably have some time to think it over; why not look at some other properties so that you can get a better idea of the pros and cons that the house itself offers in the price range that your M-I-L is asking you to pay.
1 vote Thank Flag Link Mon Jan 4, 2010
Hi North Massapequa:

How are you doing?

I recently sold a home like this, that was sold to an unreleated buyer from a seller who was the daughter of the oringinal owner, and there can be issues that crop up as a result.

First and foremost, why are you buying this particular home?

Is it going to be a "quit claim deed", are you going to use separate Realtor's or Attorney's? Have you thought about a "living trust". There can be title "issues" to work out as well.

Was the lien on the property, prior to 1986? Can the lien be "assumbed", or is the lien payed off?

Many people have different ideas on how to proceed in this particular situation, and this is getting more common I've noticed.

I would be interested in what the tax advisor's, settlement attorney's, etc. think.

So, what do you financial guru's think is the best bet?

Johnny "Culdesac" Yankoviak
Weichert Realtors
Gainesville, Virginia
1 vote Thank Flag Link Mon Jan 4, 2010
If you know the condition of the house, and you want to live in it, and if the price is good. than buy it.
If you enrich your self at your aunt misfortune than you know the answer to that.
0 votes Thank Flag Link Tue Jan 5, 2010
If you like the house and know you'll be happy living there, you cares who the seller is--do have an attorney review all documention.

Anna
0 votes Thank Flag Link Mon Jan 4, 2010
One great pro is that you could buy it without having to come up with any money out of pocket through a "gift of equity".

For example, lets assume that she is looking to walk from the deal with $320,000. She could sell it to you for $400,000 (assuming that would be the fair market value and it would appraise for that amount) and instead of you coming up with $80,000 for a downpayment, she could fill out a form that states that she is gifting that $80,000 to you and that you don't have to actually give it to her.

She can also pay your closing costs for you.

This has to be structured properly from the get-go.

Hope this was helpful. Feel free to contact me for more info.
0 votes Thank Flag Link Mon Jan 4, 2010
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