Would you trust this offer?

debodun

debodun

SF VIP
Location
way upstate in New York, USA
When I was selling my aunt's house to settle her estate, the man that eventually bought it asked if I had any other property to sell. I said that I'd probably like to sell my house at some point. He came and looked at it. Then he made the offer that he would buy it and I could continue to live in it using the purchase price towards the rent. For example, if he paid me $100,000 and the rent was $1000 a month, I could live there some 8 years. After I had exhausted the "credit", I had the option of continuing to live there and pay rent OOP. However, he would actually own it. I just didn't like the "feel" of that. One he is the owner, he could evict me at any time. What do you think?

BTW - The woman that used to live next door had a similar arrangement - a local businessman bough her house and let her live in it and I don't think she ever had a problem with that arrangment.
 

Would that rent you pay cover the cost of utilities, property taxes, and routine upkeep? Other considerations like transportation, home size, health issues play into the decision to live where you are used to living.

Way to many unknowns.
 
Knight said:
Would that rent you pay cover the cost of utilities, property taxes, and routine upkeep?
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I assume he, as the owner, would be responsible for all the things you mentioned. We really didn't go into it much since I wasn't interested at the time to discuss it much. As the cold winter settles in, and the wind is blowing through the window casements, I and thinking more about it, though.
 

It seems to me that you are making a gift of your home to this person. You transfer the deed to him in exchange for a $100,000.00 rent credit. All you have is a safe full of promises. He can put a mortgage on the house, sell it, who knows what. I'm afraid you will be on the curb waving your agreement at the local sheriff. If you want to sell your home sell it and get the cash in your hand, no side deals, no mortgages, etc...
 
Aunt Bea said:
It seems to me that you are making a gift of your home to this person. You transfer the deed to him in exchange for a $100,000.00 rent credit. All you have is a safe full of promises. He can put a mortgage on the house, sell it, who knows what. I'm afraid you will be on the curb waving your agreement at the local sheriff. If you want to sell your home sell it and get the cash in your hand, no side deals, no mortgages, etc...
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That's what I thought.
 
It depends on your situation. If you need the first $100,000 to keep on living for 8 years in your home, it may be beneficial. But your rights as a tenant, and his rights as an owner is a murky area. You would have to have 148 page agreement, written by six teams of attorneys, to cover every conceivable problem. You do realize that you are selling you home at 2016 prices. 2024 prices might be twice what you sold you home for.
 
boaterboi said:
Look into a reverse mortgage instead.
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I agree. I think your interests would be better protected with a reverse mortgage. You would want to look for a Home Equity Conversion Mortgage which is only available through an FHA approved lender. These are insured by the Federal Government. It seems like there are too many "what ifs" like those that other members of the forum mentioned above with the deal you mentioned. Better to go through an established and insured procedure, IMHO, if that's the route you want to go.
 
Over here this kind of arrangement is quite normal.

I know a man who works for a company that will buy your
house, probably for less than the market value and you can
live in it till you die for free.

I think that they normally choose elderly people to deal with.

Mike.

P.S. It is called "Home Reversion" a form of Equity release.
 

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