Mom in Ass't Living now wants to sell her house

[jpjr]

Solution:

Mom will "gift" 1/3 of home to Sister #1. Sister #1 will then be able to have insurable interest in the home and the insurance policy will now include both parties as named insureds. All property taxes , HOA documents etc will now have Sister #1's name so she will be able to assume those responsibilities.
A separate document will outline Sister #1's responsibilities to pay all costs associated with the home as well as her duty to utilize any proceeds from the estate to pay each sibling their 1/3 share of the "current" value of the home which will be determined prior to signing the document later this month.
The one item not addressed in the "mortgage" scenario is that any funds that Sister # 2 and I would have received would be considered income, which this revised process avoids.

 

[ivinsfan]

jpjr, I like a person that get stuff done. Don't pay any attention to the nit-pickers posting after me.

 

[robnplunder]

Giving advice on this kind of question is fraught with danger as we don't know all the sides of the story. There are too many unknowns here. Good luck with the OP and his family in sorting this out.

 

[pb4uski]

Solution:

Mom will "gift" 1/3 of home to Sister #1. Sister #1 will then be able to have insurable interest in the home and the insurance policy will now include both parties as named insureds. All property taxes , HOA documents etc will now have Sister #1's name so she will be able to assume those responsibilities.
A separate document will outline Sister #1's responsibilities to pay all costs associated with the home as well as her duty to utilize any proceeds from the estate to pay each sibling their 1/3 share of the "current" value of the home which will be determined prior to signing the document later this month.
The one item not addressed in the "mortgage" scenario is that any funds that Sister # 2 and I would have received would be considered income, which this revised process avoids.

So you mom still owns 2/3 of the house?

I don't understand how sister#2 or OP would ever have income with the mortgage scenario... the mortgages that you receive from your mom would have been gifts from her to you just like the 1/3 of the home from mom to sister#1 is a gift.

But I'm glad you have found a solution that you are all comfortable with.

 

[UpQuark]

I'm glad that the current house value is going to be determined, since sister#1 was wanting repairs I wondered if she'd be getting 1/3 of an ideal value and then be stuck having to make costly repairs.

 

[jpjr]

Final resolution: Enhanced Life Estate Warranty Deed where Mom gifted 1/3 of the home to Sister # 1 and in turn, Sister #1 signed a Property Agreement stating she will pay her two siblings their 1/3 share within 30 days of Mom's passing. Sister #1 is now responsible for all costs associated with the home.

 

[skyking1]

thanks for the follow up.