has any one ever purchased a home from a relitive?: Off-topic discussion forum: Grassroots Motorsports Magazine

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Nov. 23, 2009 12:28 a.m. HappyAndy Reader

One of my wife's relatives is planning to retire and move down south in about a year. She knows that we have been planning to move out of our home because the neighborhood & school district are awfull, and has asked if we would be interested in buying her house. Her asking price sounds quite reasonable and she has been completly up front about the problems that she knows the house has (I've helped fix a few of them already), and has no objections to having the house professionaly inspected and appraised.

So if the inspection doesn't reveal any deal breaking/ run away screaming problems and I decide to proceed with buying it, what is the best way to proceed with an intra-family deal like this?

My last home purchase was a disaster and I would never deal with any of the people involved in that transaction again. It left a very bad taste in my mouth, as far as the real estate business goes. Just thinking about having to deal with that again gets me pretty agitated, but as I've already mentioned I really do need to get out of my current house for the sake of my family, and its a hopeless piece of E36-M3 too.

I'm obviously no real estate expert, and nor do I want to become one if I don't have to, but I need to do this right and not be taken as a sucker like some of the players in my last home purchase tried to. The problems I had last time around were not with the seller but with my real estate agent, my mortgage broker, the home inspection company that I hired and the title transfer company. I would like to have as much professional help as I can get/ afford, and be able to be confident that I am getting my best interests protected, and not have to fire anybody or pay for services that are not required, etc.

Should I hire a real estate agent as a consultant, or go through a real estate lawyer, both, or something entirely different? Since I need to sell my current house anyway, I think I'm going to need the services of a real estate agent no matter what goes on with the relatives house, so what is a good way to screen out the scummy ones? Should I try the BBB, or Angies list? And if any one knows of the real estate industries equivalent to the GRM forums I would like to know about it, please.

Thanks, in advance for the input GRM'ers, and I do realize that advise found on the interweb is seldom worth more that what was paid for it, and is for novelty purposes only.
Nov. 23, 2009 1:21 a.m. BoxheadTim Reader

One of my sisters-in-law and her husband are both lawyers and she handles a lot of real estate transactions. From listening to some of her "war stories" I would certainly think that you'd need a good real estate lawyer. I'd skip a realtor for the purchase - it's not like you'd need to pay them a finder's fee for your relatives house, is it?

One other thought I have is that you might want to have a chat with a tax advisor, especially if your relative is selling you the house at a comparatively low price to ensure that there are no potential implications for you or your relative if someone deems that the good price the house was sold to you for was below market value. At least over here in the UK stuff like that can cause tax problems...
Nov. 23, 2009 6:58 a.m. suprf1y Reader

Up here you can do everything yourself, so there is no need to involve lawyers, or agents. However, I have used lawyers on a few private sales, and they have been completely painless.

It is important to shop round, as I got prices from $400 - $1200 from different firms. I found a guy I like, and his prices are good. No need to involve an agent. The more people involved, the more money it will cost you, and real estate agents provide precious little value for the money they command.
Nov. 23, 2009 7:34 a.m. HappyAndy Reader

suprf1y wrote: No need to involve an agent. The more people involved, the more money it will cost you, and real estate agents provide precious little value for the money they command.

This is what I was thinking, thanx
Nov. 23, 2009 7:37 a.m. minimac Dork

If you're going to have a mortgage, the banks' lawyer will be going through everything(to protect the banks' interest). In a lot of cases, the banks' interest is the same as yours. There is no need to get a real estate agent involved- that would be wasting money. If you are not totally comfortable using the bank attorney, spend the couple of hundred dollars for your own, to protect your interest. Just be aware that a bank attorney works for the bank and will protect the bank. Your attorney, while looking out for you, will not be able to trump the banks'. I've done it both ways, with my own and using the bank attorney. In my case, I feel I was paying for a duplication of service and still had to be second in line to the bank if anything went wrong. Bear in mind I'm in no way qualified to give legal advice, but I do occasionally sleep at a Holiday Inn.
Nov. 23, 2009 7:40 a.m. JThw8 SuperDork

All good advice.
As far as the home inspection I think these guys are in your area http://forhouseinspect.com/

I've used them on my last 2 houses and have been very happy with their professionalism and quality of inspection.

Not a canoe, just a happy customer.
Nov. 23, 2009 7:44 a.m. HappyAndy Reader

In reply to JThw8:

Thanks for the tip, I checked thier mug shots and none were suspects in the last rip-off, err I mean transaction, so I bookmarked that site and will give them a call.
Nov. 23, 2009 9:00 a.m. RX Reven' Reader

I bought my Grandmother’s house last year when she passed away (three months short of her 100th Birthday BTW). I’m in California so tax considerations were the most complex issue and carried the most significant consequences. I wound up paying a paralegal $400 to manage the transaction and everything worked out perfectly.

As has been said, Realtors provide very little service relative to what they charge and lenders share common interests with you and have a capable, proven process in place.

Here’s an interesting statistic to get everyone good and furious…the claim to premium ratio on title insurance is 1/25. In other words, you get four cents of value for every dollar you spend on title insurance and the remaining ninety six cents goes to profit and overhead for the provider.
Nov. 23, 2009 9:50 a.m. Karl La Follette HalfDork

www.zillow.com and get title insurance / paralegal
Nov. 23, 2009 10:06 a.m. Johnboyjjb New Reader

I bought my current house from my parents and they carried the mortgage. We were good friends with a real estate agent and she was willing to use her contacts to get the job done. We didn't pay her a thing directly and got competitive rates from the title company and others. She was happy to help us and said the kickbacks from the inspector and title company were more than enough to cover her time. The terms of the mortgage were simple. 30 year fixed at 5.75 % with a mandatory pay -off after 10 years. I finished the refinance and they got a nice lump sum to retire on.