Home Selling in 73128>Question Details

Trixie Brown, Both Buyer and Seller in Oklahoma

Home in an irrevocable trust - cash-out, HELOC, mortgage, or?

Asked by Trixie Brown, Oklahoma Sun Apr 22, 2012

Hi,
I'm 43, self-employed and the sole beneficiary/ trustee of an irrevocable trust containing one fully paid-for 100K brick home in OKC (73128). The current "home owner" is in a old-folks facility though the trust gives her the right to live in the home for the rest of her life - the house is currently rented out at $450/mo (friends and family rate), to provide us both with a little extra income. I live in a different house (73108) that's worth maybe 50-60K - 15yr private mortgage @ $300 per month with 7 years remaining. I'm looking at moving to Oregon permanently though it'd be nice to have enough cash up front to go "test the waters" first before selling up everything here and buying there. The recession has decimated our savings and we both have bad credit scores so I'm hoping you can tell me what options there are for getting cash out of these homes - loan or sale - given the situation. Thank you

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4
John Phillips’ answer
If you have less than an average credit score then my suggestion would be to sell both homes and use all of the equity to buy you a home in Oregon: How ever you may not be able to sell the home the elderly person owns since the trust states she has the right to live in the home till death: Check with a lawyer:

Thank you
john Phillips
1 vote Thank Flag Link Sun Apr 22, 2012
For clarification, is the "home owner" the same as the "staying in the nursing" home or the current "tenant" of the home?

First: If the trust has given the "home owner" the right to live in the home for the rest of the "home owner's" life, yet the "home owner" and the trust can come to a written agreement removing this right, i.e. doctors orders that the "home owner" must remain in the nursing home due to ill heath or because the Trust deems it necessary, this right can be removed.

Second: If the "home owner" and the individual/persons currently renting the home are not the same person and the trust and the "home owner" come to a written agreement removing the right to occupy the property for the remainder of the "home owner's" life, the Trust can not renew/extend the current individual/person's lease on the property's and sale the property vacant or sale the property to an investor while still rented and the purchaser can raise the rent rates to market value once the lease is up for renewal/extension.

Third: If you do sale out of both homes, you will have enough cash on hand to place a large enough down payment w/ any rent-to-own options in Oregon, check the local papers for these options.

Every problem has more than one solutions, these are just some thoughts.

Hope this helps,


Josh Barnett, Realtor
Metro First Realty
0 votes Thank Flag Link Sat May 5, 2012
solution, not solutions, typo, sorry.
Flag Sat May 5, 2012
If you both have bad credit, I don't see you getting a new loan, You will propably need at least a 580 on your credit score. This would require a larger down payment for your new purchase. A 640 or better is preferred. This would allow a 3.5% down payment for an FHA loan.

Check with a trust attorney, but I don't believe you'll be able to sell that house until the elderly woman has passed. You may be able to count the income though.

Please feel free to contact me if you would like more information on the values of the homes. I'll be glad to help.

Bridgett Wells
Keller Williams Realty
651-9320
bridgettwells@kw.com
0 votes Thank Flag Link Sun Apr 22, 2012
Thank you all for your time and info - I just found out my score is 609 now with only one bad $385 debt on an old bank account and nothing else showing at all (to my complete surprise). We can take the house out of trust too if there's no way around it - right now I'd just like to get maybe a 10-20K loan rather than selling outright unless someone makes an exceptionally good offer. We have that house - 2424 Sycamore Ave 73128, this one 2529 SW 25 th St 73108, and on a separate note a friend that's wanting to sell a very bad one, 3412 SW 22nd 73108 - if you think you might be able to help. In a perfect world we could trade one or both for a small storefront business with attached residence either here in OKC or Oregon but that's getting ahead of myself.
Flag Sun Apr 22, 2012
I would suggest you review the trust with the trust attorney.
Web Reference: http://www.terrivellios.com
0 votes Thank Flag Link Sun Apr 22, 2012
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