topic Mortgage and estate in Mortgage Loans

Mortgage and estate

Jnbmom — Sun, 20 Jul 2025 19:47:47 GMT

We are moving in with MIL very soon to take care of her .

The house is paid for and worth with home and land approximately 600-650K .

Once his mom passes her instructions are to divide by the 3 children and sell house and land .

The one sister technically owns long story and terrible laywer advise . However trust is being set up and since we are the live in caregivers we have atleast a year to move out ( I don't think it will take that long ) however it's gives us cushion once she passes .

Now we also have the option to buy the other 2 sisters out as they both have their own homes .

So let's say we have to divide 600 , they would be 200K a piece . We could take our 200K and buy one sister out , and could we then use some equity to buy other sister out ? Not sure if this is an option or not .

Just trying to think ahead as I ultimately plan to retire to Seattle but if we could swing the house possession I may delay it .

If not we can take our share and find small apartment . Either here until I retire in 6 years or Seattle if we are still there in 6 years .

She is in her eighties but health wise not bad shape just has mild dementia and legally blind . So she may live quite a few more years she is tough country woman .

Re: Mortgage and estate

ShanetheMortgageMan — Sun, 20 Jul 2025 20:15:17 GMT

I'm a little confused when you say "The one sister technically owns long story and terrible laywer advise". Are you saying 1 of the 3 children, a sister, owns this home? Does your MIL also own this home too, or is solely owned by the sister? If the sister owns the home, is she willing to transfer it to the trust?

Assuming it'll eventually be transferred to the trust, if you guys wanted to buy out the other two siblings then it could be done as a refinance where you'd need to qualify for a $400k loan amount. At closing the two other siblings would receive $200k each and title of the home would transfer into your own name (or you can set up a revocable trust and it could be transferred into your own trust at closing) and you'd owe the mortgage lender $400k.

You sound like good kids, hope you can make more great memories with mom.

Re: Mortgage and estate

Jnbmom — Sun, 20 Jul 2025 20:43:12 GMT

Thanks @ShanetheMortgageMan . Yes technically my MIlL deeded the home to his one sister as her spouse (MIL) passed away and she was afraid HIS children would go after the estate , however turns out that couldn't have happened but that is how it went down .

Sister who owns the house is going to set up the trust as she doesn't want home in her name for taxes etc as she is building her own home .

Darn 400K that too high for us, so I guess we will go with plan A and take our share and get a little apartment .

thanks again

Re: Mortgage and estate

FicoMike0 — Sun, 20 Jul 2025 20:54:27 GMT

Might talk to a local agent about the value, just for planning.

Re: Mortgage and estate

ZackAttack — Mon, 21 Jul 2025 04:38:03 GMT

@Jnbmom wrote:
Thanks @ShanetheMortgageMan . Yes technically my MIlL deeded the home to his one sister as her spouse (MIL) passed away and she was afraid HIS children would go after the estate , however turns out that couldn't have happened but that is how it went down .

Sister who owns the house is going to set up the trust as she doesn't want home in her name for taxes etc as she is building her own home .

I think that is already a tax problem on 2 fronts.

1) When MIIL deeded to one sister that can trigger a tax event with the state/federal.
2) While a Trust is great in avoid the probate court, that may not be so with the taxes. The sister can still be the one who pays the taxes on that property & land.

Should help that sister find a lawyer that deals with estate & taxes.

-----------------

As for the OP Post, I think it might be better having the Trust sell to you; and you buy the property from the trust. That way in the trust it would only have cash to split in 3 ways and not having the property/land locked up in a trust w/ beneficiary dispute.

My opinion but not sure where the step-up basis would be at.

Re: Mortgage and estate

Jnbmom — Mon, 21 Jul 2025 11:24:49 GMT

@ZackAttack

Thanks yes the sister has "owned" the home for over 10 years however my MIL still pays the taxes ( sister is a piece of work ) I think we may just end up living there are providing her care and once she passes take our share and relocate .

Re: Mortgage and estate

GreatLife — Mon, 21 Jul 2025 18:46:00 GMT

With the involved parties still living, can someone please explain benefit(s) of a trust vs re-deeding the house to include all siblings?

Re: Mortgage and estate

ForwardLooking — Mon, 21 Jul 2025 21:25:18 GMT

@GreatLife wrote:
With the involved parties still living, can someone please explain benefit(s) of a trust vs re-deeding the house to include all siblings?

Trust seperates and protects the house from creditors and lawsuits if one of the living people gets into credit problems, sued, or something else along those lines. Also, a trust can be a shield against capital gains if written corectly. A trust will also have a trustee who will distribute among the heirs according to a will and hopefully avoid family infighting.

Owning a house in a partnership is usually a disaster and is a good way to cause family holiday dinners to be extreamly awkward. All it takes is one small disagreement or bad actor in the partnership to cause the house to be assigned to a creditor, put up on a fire sale, or be foreclosed on.

Re: Mortgage and estate

GreatLife — Tue, 22 Jul 2025 01:04:01 GMT

@ForwardLooking wrote:
@GreatLife wrote:
With the involved parties still living, can someone please explain benefit(s) of a trust vs re-deeding the house to include all siblings?
Trust seperates and protects the house from creditors and lawsuits if one of the living people gets into credit problems, sued, or something else along those lines. Also, a trust can be a shield against capital gains if written corectly. A trust will also have a trustee who will distribute among the heirs according to a will and hopefully avoid family infighting.

Owning a house in a partnership is usually a disaster and is a good way to cause family holiday dinners to be extreamly awkward. All it takes is one small disagreement or bad actor in the partnership to cause the house to be assigned to a creditor, put up on a fire sale, or be foreclosed on.

Thank You!