NeedAdvice
Confused about dryer sheets
- Joined
- Aug 11, 2009
- Messages
- 3
Hello everyone. I've been lurking on this forum for awhile now and I've found myself in a difficult family situation that I'd like to get the forums opinion on. I'm really at a loss at how, or if, I should proceed. So, here's the situation.
A couple of years ago, my brother was facing foreclosure on his home. He stopped paying the mortgage and was about 10 months delinquent. And he had no source of income. I'm guessing at the time, he probably had 150k worth of equity in the house, maybe up to 200k, assuming his loan around 100k (it was less) and the house was worth 250-300k (another house in his neighborhood sold for 350k). Of course, this was a couple of years ago, when real estate prices were higher.
So at the time, my brother was equity rich, but cash poor and about to lose all of his equity. This is where our mother decided to help out, and where the problem begins. My mother purchased the house from my brother and took out a new mortgage, with a line of credit on the equity. You can probably see where this is going. Since there was no income, the line of equity was used to pay the mortgage, plus a bunch of additional bills that accumulated since there was no income.
Well, fast forward to today and the equity line has been sufficiently utilized and there's still no income on the brother's part. There should still be enough equity, where if everything was sold, then the all of the debt would be payed with some leftover. But naturally, the longer this proceeds, the higher the chance there won't be enough.
So now comes the hard part. Our mother has told my brother that she isn't going to take any more money from the line of equity. Either he starts paying the mortgage, or the house will be sold. My brother took the easier route of avoiding all conversation with family. He basically disappeared for the last month (not answering phone, etc). We had a family get together the other day where everyone was here, but he avoided my mother. I visited my mother the other day, and she asked me if he mentioned anything about the house. He didn't. I offered to give him a call (he usually answers when I call) and ask him. I figured I could at least give him a heads up and see what his plans are.
Well, that's where the sh*t hit the fan. I gave him a call last night, and within about 10 seconds of conversation, he got defensive, yelling, angry, irrational, all of the good stuff (sigh). I did my best to keep calm and reiterated the point that I didn't want to get involved, but that he needs to communicate more with our mom instead of avoiding the problem. He doesn't see why our mother can't just write the check every month from the line of credit. Eventually he hung up. I called back, left him a message (he didn't answer) saying I'm sorry I brought it up, he should deal with it with our mother and for him to take care.
Unfortunately, I don't see a way for this to end well. Our mother is trying to retire (she's 66). Her retirement funds are minimal as it is, but with social security and a little bit of money saved up, she can probably get by ok (barely). She surely doesn't need the drain of dealing with his house. What I worry about is that eventually my brother's house drives her in the negative and she starts losing her own money. At this point, we're the ones that would most likely have to make up the difference (curse of the responsible sibling). I realize there's probably a number of you that say I shouldn't get involved, but this is the primary reason I want to get this resolved. If our mother can't afford to get by every month, we're the only ones that can help her out. We have a vested interest in making sure that her finances are in order.
As for my brother, after last night's conversation, I see that he's only thinking about himself. He'll pretty much make up anything on the spot to get sympathy for his sitation. He's also convinced that everybody is trying to steal from him (he's made the claim that my mother/sister have used his equity). One example he brought up is that his girlfriend - with whom he has two children, 3 and 1 - was trying to steal money from him. He went as far to say that this is why he stopped paying his mortgage in the first place and why he needed to transfer the house to our mother, so he wouldn't lose his equity. Complete BS. Another problem is that he thinks he has more equity than he probably has. He kept saying he still has 100k in equity. I don't know the numbers right now, but I doubt it's that high, especially with the drop in real estate values.
At the time, I know my mother was hoping that he would eventually start working, show income, and be able to buy the house back from her. But this isn't going to happen and now she's trying to figure out how to get rid of this house.
This is where I wanted to ask the wisdom on the forum. My mother is thinking of contacting a real estate attorney to help get rid of the house. She's willing to auction it (it's not in a sellable state, kitchen/electrical is not done) or any other way to get enough money out of the house to pay off the debt.
The hard part is dealing with my brother. I'm not sure she has the heart to follow through, but since my brother isn't communicating with her, she figures she'll just find somebody else (ie. real estate lawyer) that can take care of everything without any interaction with my brother. I'm skeptical on how well this would work.
So, any advice on how my mother can ditch the house?
I just don't see how this can end well. In the end, I'd like to make sure my mother is taken care of, her assets are protected, etc.
Any advice, opinions, etc, is greatly appreciated.
A couple of years ago, my brother was facing foreclosure on his home. He stopped paying the mortgage and was about 10 months delinquent. And he had no source of income. I'm guessing at the time, he probably had 150k worth of equity in the house, maybe up to 200k, assuming his loan around 100k (it was less) and the house was worth 250-300k (another house in his neighborhood sold for 350k). Of course, this was a couple of years ago, when real estate prices were higher.
So at the time, my brother was equity rich, but cash poor and about to lose all of his equity. This is where our mother decided to help out, and where the problem begins. My mother purchased the house from my brother and took out a new mortgage, with a line of credit on the equity. You can probably see where this is going. Since there was no income, the line of equity was used to pay the mortgage, plus a bunch of additional bills that accumulated since there was no income.
Well, fast forward to today and the equity line has been sufficiently utilized and there's still no income on the brother's part. There should still be enough equity, where if everything was sold, then the all of the debt would be payed with some leftover. But naturally, the longer this proceeds, the higher the chance there won't be enough.
So now comes the hard part. Our mother has told my brother that she isn't going to take any more money from the line of equity. Either he starts paying the mortgage, or the house will be sold. My brother took the easier route of avoiding all conversation with family. He basically disappeared for the last month (not answering phone, etc). We had a family get together the other day where everyone was here, but he avoided my mother. I visited my mother the other day, and she asked me if he mentioned anything about the house. He didn't. I offered to give him a call (he usually answers when I call) and ask him. I figured I could at least give him a heads up and see what his plans are.
Well, that's where the sh*t hit the fan. I gave him a call last night, and within about 10 seconds of conversation, he got defensive, yelling, angry, irrational, all of the good stuff (sigh). I did my best to keep calm and reiterated the point that I didn't want to get involved, but that he needs to communicate more with our mom instead of avoiding the problem. He doesn't see why our mother can't just write the check every month from the line of credit. Eventually he hung up. I called back, left him a message (he didn't answer) saying I'm sorry I brought it up, he should deal with it with our mother and for him to take care.
Unfortunately, I don't see a way for this to end well. Our mother is trying to retire (she's 66). Her retirement funds are minimal as it is, but with social security and a little bit of money saved up, she can probably get by ok (barely). She surely doesn't need the drain of dealing with his house. What I worry about is that eventually my brother's house drives her in the negative and she starts losing her own money. At this point, we're the ones that would most likely have to make up the difference (curse of the responsible sibling). I realize there's probably a number of you that say I shouldn't get involved, but this is the primary reason I want to get this resolved. If our mother can't afford to get by every month, we're the only ones that can help her out. We have a vested interest in making sure that her finances are in order.
As for my brother, after last night's conversation, I see that he's only thinking about himself. He'll pretty much make up anything on the spot to get sympathy for his sitation. He's also convinced that everybody is trying to steal from him (he's made the claim that my mother/sister have used his equity). One example he brought up is that his girlfriend - with whom he has two children, 3 and 1 - was trying to steal money from him. He went as far to say that this is why he stopped paying his mortgage in the first place and why he needed to transfer the house to our mother, so he wouldn't lose his equity. Complete BS. Another problem is that he thinks he has more equity than he probably has. He kept saying he still has 100k in equity. I don't know the numbers right now, but I doubt it's that high, especially with the drop in real estate values.
At the time, I know my mother was hoping that he would eventually start working, show income, and be able to buy the house back from her. But this isn't going to happen and now she's trying to figure out how to get rid of this house.
This is where I wanted to ask the wisdom on the forum. My mother is thinking of contacting a real estate attorney to help get rid of the house. She's willing to auction it (it's not in a sellable state, kitchen/electrical is not done) or any other way to get enough money out of the house to pay off the debt.
The hard part is dealing with my brother. I'm not sure she has the heart to follow through, but since my brother isn't communicating with her, she figures she'll just find somebody else (ie. real estate lawyer) that can take care of everything without any interaction with my brother. I'm skeptical on how well this would work.
So, any advice on how my mother can ditch the house?
I just don't see how this can end well. In the end, I'd like to make sure my mother is taken care of, her assets are protected, etc.
Any advice, opinions, etc, is greatly appreciated.
