Real Estate advice....

[andrewg]

Originally Posted By: xfactor9
Just wondering why she's so anxious to get out of this house? I think it'd be easier and cheaper to rent it to him and let him take care of the house as if it were his. There would be no costs like title, escrow, appraisal, mortgage orgination, etc. Both seller and buyer are spending thousands of dollars to basically transfer a piece of paper within the family. Doesn't seem worth it.




She has lots of reasons. Some of them personal...some financial. It's just been time for her to be rid of it. If she rents it, she'll have responsibilities of a landlord that she just isn't willing to deal with. Her son wants to own his next home as well, not rent. She's been saddled with this property and nearly all the maintenance, on her own for about twenty years. The last straw was a necessary second mortgage she needed JUST before the economy tanked. Needless to say, she just wants as far away from this house as she can get.

 

[andrewg]

Originally Posted By: KD0AXS
Originally Posted By: xfactor9
Just wondering why she's so anxious to get out of this house? I think it'd be easier and cheaper to rent it to him and let him take care of the house as if it were his. There would be no costs like title, escrow, appraisal, mortgage orgination, etc. Both seller and buyer are spending thousands of dollars to basically transfer a piece of paper within the family. Doesn't seem worth it.







Would probably be difficult to buy another house or even rent when they pull your credit and see you already owe 230K on a mortgage. They will want to see that paid off first.

That will be no problem either way. We'll be doing that as a couple and we both have good jobs and great credit.

 

[pandus13]

Originally Posted By: andrewg
Originally Posted By: xfactor9
Just wondering why she's so anxious to get out of this house? I think it'd be easier and cheaper to rent it to him and let him take care of the house as if it were his. There would be no costs like title, escrow, appraisal, mortgage orgination, etc. Both seller and buyer are spending thousands of dollars to basically transfer a piece of paper within the family. Doesn't seem worth it.




She has lots of reasons. Some of them personal...some financial. It's just been time for her to be rid of it. If she rents it, she'll have responsibilities of a landlord that she just isn't willing to deal with. Her son wants to own his next home as well, not rent. She's been saddled with this property and nearly all the maintenance, on her own for about twenty years. The last straw was a necessary second mortgage she needed JUST before the economy tanked. Needless to say, she just wants as far away from this house as she can get.

can i recommend contacting a mortgage broker to see what the son is qualified for and maybe do a house appraisal to see if it's within the 230k.
then compare the numbers to son taking over= 10 years left of first mortgage + 25 years left of second mortgage + house maintenance + transfer title mom to son

good luck

 

[99Saturn]

JMHO - but I don't see any value to an appraisal outside of what the son's lender is going to require. Not sure if the recommendations are an appraisal before the son kicking off an application for the loan or as part of that loan application.

I say that because AFAIK the appraisal by the son's lender is going to be the only one that is relevant, if the house for some reason appraises under $230K when one is ordered by the lender, it really doesn't matter what the home appraised for before that.

Also FWIW, calculating the son's front end and back end ratio is going to tell what he will qualify for, no need to do much more until stuff is ready to move forward 9if that isn't today).

 

[GreeCguy]

Originally Posted By: hatt
Originally Posted By: andrewg

A realtor got involved when her son started looking for a home without telling his mother. As soon as she found out he was looking...she offered her home.
Did the son sign a contract with the realtor?


Someone correct me if I'm wrong, but it's my understanding that if the son signed a contract with a real estate agent, the agent can still claim his or her commission regardless of who found the house or how the deal is done until the contract expires. A typical contract runs for six months. I could be wrong on this one but it would be worth looking into just in case.

 

[Win]

Originally Posted By: GreeCguy
...
Someone correct me if I'm wrong, but it's my understanding that if the son signed a contract with a real estate agent, the agent can still claim his or her commission regardless of who found the house or how the deal is done until the contract expires.

....


Possibly, but I've not seen one that bound buyers in that fashion, because the commission typically comes from the seller (of course the sale price will be inflated to cover the commission, so, like all things in life, ultimately the consumer of the good or service pays the costs).

Anyway, it depends on the wording of the contract, the type you are referring to are called "exclusive" contracts, and typically bind the seller to pay a commission even if he procures the sale through his / her own efforts independent of the listing realtor, or if the seller sells to a buyer procured by the realtor during the term of the listing, but does so after the listing agreement has expired. It's certainly possible one could be written to similarly obligate a buyer.

It always pays to closely read contracts one is signing, and to negotiate the terms one finds unacceptable, or decline to enter into the contract.

 

[PandaBear]

A quick zillow estimate or going to a large bank to enter address should give you a ball park on how much it is worth, before even starting a lending process for the full appraisal walk through (that's IMO just to get a personal responsible in case there's a fraud).

The bank will have some safety margin, and with income and credit info of the son will let you know whether he will be qualified to "take over" the house or not.

 

[SatinSilver]

Originally Posted By: GreeCguy
Someone correct me if I'm wrong, but it's my understanding that if the son signed a contract with a real estate agent, the agent can still claim his or her commission regardless of who found the house or how the deal is done until the contract expires. A typical contract runs for six months. I could be wrong on this one but it would be worth looking into just in case.


The contract signed is most likely just for the sale of his current home. Not the future home. So the realtor will get the commission on the sale of the home. Which should make him/her happy.

Since the mom has lived there 20 years, I sure hope the house is worth MORE than what's owed on it.

 

[andrewg]

Originally Posted By: satinsilver
Originally Posted By: GreeCguy
Someone correct me if I'm wrong, but it's my understanding that if the son signed a contract with a real estate agent, the agent can still claim his or her commission regardless of who found the house or how the deal is done until the contract expires. A typical contract runs for six months. I could be wrong on this one but it would be worth looking into just in case.


The contract signed is most likely just for the sale of his current home. Not the future home. So the realtor will get the commission on the sale of the home. Which should make him/her happy.

Since the mom has lived there 20 years, I sure hope the house is worth MORE than what's owed on it.

The house is about even in value to what is owed...unfortunately. She came upon financial difficulties due to a spouse passing away back before the economy tanked. He did nothing to prepare her for such an event...and his family offered nothing in the way of assisting her limited income in caring for him in hospice as well as the funeral costs afterward. She was not even granted a benefit of life insurance from his demise. To stay afloat she applied for a second mortgage. Soon after, the economy fell apart. It's only now that she will break even if she can sell it.
Her sons realtor turns out to be a friend as well and is giving him advice and guidance (free of course) in how to purchase his moms place. The contract only applies toward selling his home.
Thanks again to all that have given ideas. You've all been very informative and helpful.

 

[HTSS_TR]

Originally Posted By: Win
Possibly, but I've not seen one that bound buyers in that fashion, because the commission typically comes from the seller (of course the sale price will be inflated to cover the commission, so, like all things in life, ultimately the consumer of the good or service pays the costs).

Anyway, it depends on the wording of the contract, the type you are referring to are called "exclusive" contracts, and typically bind the seller to pay a commission even if he procures the sale through his / her own efforts independent of the listing realtor, or if the seller sells to a buyer procured by the realtor during the term of the listing, but does so after the listing agreement has expired. It's certainly possible one could be written to similarly obligate a buyer.

It always pays to closely read contracts one is signing, and to negotiate the terms one finds unacceptable, or decline to enter into the contract.

Are you sure about this ?

 

[Win]

Originally Posted By: HTSS_TR
Originally Posted By: Win
Possibly, but I've not seen one that bound buyers in that fashion, because the commission typically comes from the seller (of course the sale price will be inflated to cover the commission, so, like all things in life, ultimately the consumer of the good or service pays the costs).

Anyway, it depends on the wording of the contract, the type you are referring to are called "exclusive" contracts, and typically bind the seller to pay a commission even if he procures the sale through his / her own efforts independent of the listing realtor, or if the seller sells to a buyer procured by the realtor during the term of the listing, but does so after the listing agreement has expired. It's certainly possible one could be written to similarly obligate a buyer.

It always pays to closely read contracts one is signing, and to negotiate the terms one finds unacceptable, or decline to enter into the contract.

Are you sure about this ?


In my state, yes.

 

[Cujet]

I used a local title company to complete a similar transaction. The cost was minimal, the support very professional and we saved a bunch of money in various areas.

 

[HTSS_TR]

Title company can do Escrow ?

 

[MedicRxDoc]

Originally Posted By: HTSS_TR
Title company can do Escrow ?


My title company did everything. It was a handshake agreement to purchase the house from a friend of a friend. Title company arranged everything to close the deal. Only cost was the usual charge for title insurance, even got a break and got a second issue rate since I used them before for our previous home. No Realtor fees saved me on the purchase cost since we arranged our offer based on 6% fee being deducted from the appraisal. I don't know if I would do this way again as there was a considerable amount of risk doing it this way, but it got done without any problems.

 

[HTSS_TR]

Thanks, MedicRxDoc.

We may sell our house this year. Last year a friend of mine sold his house, his Escrow company charges almost $3k for just their fee alone, add other fees his cost was almost $10k, this didn't include Realtor fee of 6% which can be more than $30k for the house sold for more than $500k.