Personal Finance (Not Investing) • Cleaning up a parent's financial mess - where to start

I had the idea that I could just buy the house from him in the short term, pay off the bank at closing, and let him live there rent-free for some period of time, maybe 6 months, while we clean the place up, he looks for an apartment, etc. That would also give him time to go through the substantial amount of stuff he's accumulated, maybe sell it off to raise some extra cash. Then I could clean the place up on my own terms and sell without being rushed. Without real estate agents, mortgage fees, title insurance, etc the sale to me could probably be done cheaply.

I could probably raise $400k in two weeks by a combination of liquidating some assets and borrowing some money on good terms (my credit is good, much better than his). I would need to be paid back eventually but would be willing to pay the cost of money for a few months.

I would not be willing to pay off the bank without getting title to the house. My dad's had a history of not following through with financial agreements and that's too much risk for me. I probably would be willing to take the risk of having him as a tenant. If he refuses to leave it's easier to evict him than collect an unsecured loan from him.

Does this seem like a reasonable idea to you?

Buying the house from him sounds like a terrible idea. Why tie your own assets up in this mess? I think there are ways to accomplish the goals you lay out above without going to such an extreme step. I'm fairly certain that foreclosure can be staved off with appropriate intervention from a lawyer. Banks don't want to foreclose - that's a last resort for them. They'd rather just have the amount in arrears paid off and the monthly payments start again.

I think your absolute first step should be to contact an attorney. It might be a good idea to find one that specializes in elder law - even if their bread and butter is more trusts etc, I suspect that this sort of situation happens quite often and they will know what to do. At the very least, they can suggest a colleague who would be able to help.

(By the way, if the mortgage hasn't been paid recently, that suggests property taxes haven't been paid either - so best check on that as well.)

Statistics: Posted by fyre4ce — Wed Oct 09, 2024 10:43 pm — Replies 15 — Views 2004