Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
Condo "Lease"
Old 03-05-2018, 02:21 PM   #1
Recycles dryer sheets
Ready2Go's Avatar
 
Join Date: Sep 2017
Posts: 78
Condo "Lease"

So....my mother is moving in with my sister. She is is mid-to-late stages of dementia and really can't live on her own any longer. She has offered her place to my 29 yo niece as a place to live while my mother (her grandmother) is still alive. Everyone understands that the condo will be sold upon her death. This is a 2br, 2 bath, 2 car garage condo in a desirable complex and area. It would rent for approx. $1800 per month. I'm fine with her living there and she will pay some of the cost...HOA, utilities, etc. Nowhere close to $1800. I'm ok with the family discount as it is my mother's desire to do this.

Being the worrier among my siblings, I'd prefer that it not be open-ended. I'd like to have an annual lease agreement. If nothing else, in the unlikely event she becomes a junkie or flakes on her responsibilities, we can evict her or just not renew the lease.

The questions I have are...am I overthinking this? The condo is currently in a revocable living trust for me and my siblings....is that who needs to sign the lease?

Anyone have experience with this?

Thanks in advance.
__________________

Ready2Go is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 03-05-2018, 02:30 PM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: May 2005
Posts: 15,409
From watching the judge shows on TV I would say that you need to look at the state laws on tenants and what can be done..

Almost every one I have seen if there is no written lease then it is considered month to month and either party can give 30 days notice... so it should not be a problem...


Now, who is the trustee? They are the ones who have legal right to evict...
__________________

Texas Proud is offline   Reply With Quote
Old 03-05-2018, 02:31 PM   #3
Moderator Emeritus
aja8888's Avatar
 
Join Date: Apr 2011
Location: The Woodlands, TX
Posts: 11,377
Quote:
Originally Posted by Ready2Go View Post
So....my mother is moving in with my sister. She is is mid-to-late stages of dementia and really can't live on her own any longer. She has offered her place to my 29 yo niece as a place to live while my mother (her grandmother) is still alive. Everyone understands that the condo will be sold upon her death. This is a 2br, 2 bath, 2 car garage condo in a desirable complex and area. It would rent for approx. $1800 per month. I'm fine with her living there and she will pay some of the cost...HOA, utilities, etc. Nowhere close to $1800. I'm ok with the family discount as it is my mother's desire to do this.

Being the worrier among my siblings, I'd prefer that it not be open-ended. I'd like to have an annual lease agreement. If nothing else, in the unlikely event she becomes a junkie or flakes on her responsibilities, we can evict her or just not renew the lease.

The questions I have are...am I overthinking this? The condo is currently in a revocable living trust for me and my siblings....is that who needs to sign the lease?

Anyone have experience with this?

Thanks in advance.
Mom is moving in with your sister. (Mom has dementia)

29 year old is getting who's place?

Not sure who's in what?
__________________
Saying on a Get Well card from a friend of mine after I had my second hip replacement - "Don't let the Old Man in..."
aja8888 is offline   Reply With Quote
Old 03-05-2018, 02:34 PM   #4
Thinks s/he gets paid by the post
 
Join Date: Mar 2013
Location: Coronado
Posts: 1,682
If your mother owns the trust and you and your sibs are the beneficiaries, then your mother (or whoever has her POA) would sign the lease.

From your side, it would be better to have a month-to-month lease, or an annual lease that converts to month-to-month after the first year.
cathy63 is online now   Reply With Quote
Old 03-05-2018, 02:59 PM   #5
Moderator
braumeister's Avatar
 
Join Date: Feb 2010
Location: Flyover country
Posts: 15,092
Have you looked at the rules in the HOA?
In my condo development, leasing is fine, but the lease must be in writing, approved by the HOA board, and for a minimum of six months. The occupant must also sign an agreement to abide by all the HOA rules.
braumeister is offline   Reply With Quote
Old 03-05-2018, 03:09 PM   #6
Recycles dryer sheets
Ready2Go's Avatar
 
Join Date: Sep 2017
Posts: 78
Quote:
Originally Posted by aja8888 View Post
Mom is moving in with your sister. (Mom has dementia)

29 year old is getting who's place?

Not sure who's in what?
LOL.

Niece is moving in to my mom's condo....her grandma's. My mom is moving into my sister's house.
Ready2Go is offline   Reply With Quote
Old 03-05-2018, 04:22 PM   #7
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Sunset's Avatar
 
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 9,180
Quote:
Originally Posted by braumeister View Post
Have you looked at the rules in the HOA?
In my condo development, leasing is fine, but the lease must be in writing, approved by the HOA board, and for a minimum of six months. The occupant must also sign an agreement to abide by all the HOA rules.
I have seen Condos, where leasing/renting is not allowed, and the HOA kicked out the tenants.

If the fair rent would be $1,800, then I would not rent for less than $1,500 as you will find there will be surprises, damage, etc.... and easier to charge more than to charge less and be upset at replacing the flooring.
After all you could rent it to a stranger for the full amount which is an extra $3,600 per year

Besides, you have to consider, to be "strictly legal", this will be a rental to the IRS, unless you are comfortable with that, you will have the added expense of someone to do the taxes regarding the rental.

The insurance as a landlord will be higher, and be sure the niece has tenant insurance with at least $1M liability (should only cost her $150/yr).
__________________
Fortune favors the prepared mind. ... Louis Pasteur
Sunset is online now   Reply With Quote
Old 03-05-2018, 04:31 PM   #8
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Brat's Avatar
 
Join Date: Feb 2004
Location: Portland, Oregon
Posts: 6,557
Carefully read the HOA CCNRs. Maybe because the occupant will be a granddaughter it would be considered to be exempt from any leasing rules (check housing laws).

If the CCNRs limit rentals it would be worth your while to consult a real estate attorney to prepare an occupancy agreement with the young lady to set some rules about her tenancy. I wouldn't announce the fact that your Mother has 'moved', only that she 'staying' with her daughter for a while. Keep her situation ambiguous.
__________________
Duck bjorn.
Brat is offline   Reply With Quote
Old 03-05-2018, 04:33 PM   #9
Moderator
braumeister's Avatar
 
Join Date: Feb 2010
Location: Flyover country
Posts: 15,092
Quote:
Originally Posted by Brat View Post
Carefully read the HOA CCNRs. Maybe because the occupant will be a granddaughter it would be considered to be exempt from any leasing rules (check housing laws).

If the CCNRs limit rentals it would be worth your while to consult a real estate attorney to prepare an occupancy agreement with the young lady to set some rules about her tenancy. I wouldn't announce the fact that your Mother has 'moved', only that she 'staying' with her daughter for a while. Keep her situation ambiguous.
That makes very good sense. You could even call it a house-sitting arrangement.
braumeister is offline   Reply With Quote
Old 03-05-2018, 04:55 PM   #10
Recycles dryer sheets
 
Join Date: Jan 2017
Location: Charlotte
Posts: 222
"Everyone understands..."

Many a family relationship destroyed down the road in believing the above phrase to be absolute.
bw5972 is offline   Reply With Quote
Old 03-05-2018, 05:01 PM   #11
Thinks s/he gets paid by the post
 
Join Date: Mar 2004
Posts: 3,033
Clarify who is going to pay the monthly (or quarterly condo) fees.

omni
omni550 is online now   Reply With Quote
Old 03-05-2018, 05:52 PM   #12
Thinks s/he gets paid by the post
Ready's Avatar
 
Join Date: Mar 2013
Location: Southern California
Posts: 2,988
Something tells me that any attempt to sell the condo and evict the niece is going to result in major family drama, especially if the niece can't afford to find another place to live easily.
Ready is offline   Reply With Quote
Old 03-05-2018, 06:10 PM   #13
Thinks s/he gets paid by the post
 
Join Date: Dec 2010
Location: Midwest
Posts: 1,644
Quote:
Originally Posted by Ready View Post
Something tells me that any attempt to sell the condo and evict the niece is going to result in major family drama, especially if the niece can't afford to find another place to live easily.
+1.
Nice for the niece. But she will be starting a (perhaps) long ride down the road of living beyond her means, since her largest expense (housing) will never have to be paid at anywhere near market rates. Imagine her shock when the "gravy train" comes to an end, and she has to pay "real" rent. Lots of tears on the horizon.

Another advantage of a written agreement is to clarify that under no circumstances are "friends" to move in. Perhaps an immediate eviction if that clause is violated.

Get an approved lease (from an attorney or a Realtor) and go over the details. The HOA rules are important-be sure they are read and followed.
brucethebroker is offline   Reply With Quote
Old 03-05-2018, 06:13 PM   #14
Recycles dryer sheets
Cayman's Avatar
 
Join Date: Nov 2015
Posts: 255
You are smart to think proactively. I have experience with a similar situation. The "tenant" was a relative of the owner and paid only the electric bill, had no lease nor written agreement. Everyone in the family "knew" that the tenant-relative was to live there for a few months, definitely less than a year". The owner of the home was hospitalized, and then died.

The tenant-relative lived there rent free for just over 3 years. No one wanted to speak up (much) or create a family rift. Held up the estate settlement. Property values dropped prior to the sale of the home... it was a mess. I believe a legal document would have helped (lease or agreement - something of that nature that clarified the terms of the agreement and protected the broader interests of the family). Best of luck to you.
Cayman is offline   Reply With Quote
Old 03-05-2018, 06:56 PM   #15
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
 
Join Date: Jul 2006
Posts: 11,401
Quote:
Originally Posted by brucethebroker View Post
+1.
Nice for the niece. But she will be starting a (perhaps) long ride down the road of living beyond her means, since her largest expense (housing) will never have to be paid at anywhere near market rates. Imagine her shock when the "gravy train" comes to an end, and she has to pay "real" rent. Lots of tears on the horizon.

Another advantage of a written agreement is to clarify that under no circumstances are "friends" to move in. Perhaps an immediate eviction if that clause is violated.

Get an approved lease (from an attorney or a Realtor) and go over the details. The HOA rules are important-be sure they are read and followed.
This is extremely important. As a HOA board member, ask me how I know!
Meadbh is offline   Reply With Quote
Old 03-05-2018, 07:11 PM   #16
Thinks s/he gets paid by the post
 
Join Date: Dec 2014
Location: Huntsville, AL/Helen, GA
Posts: 4,086
I assume your niece is socially stable.

I bought my 30 year old daughter a house, and she turned it into Party Central. We couldn't get her to move out when we decided to sell the house. She had full tenant rights and I had to have The Sheriff evict her.I

Since Mom's situation is permanent, I would put the house on the market. House prices remain high with current low interest rates.

We liquidated my mother's real estate while she was alive and it kept us from having to probate her will. That saved us substantially.
Bamaman is offline   Reply With Quote
Old 03-05-2018, 07:17 PM   #17
Recycles dryer sheets
 
Join Date: Jul 2016
Location: Chicago
Posts: 243
I agree with the idea to get it in writing. The woman is 29 years old - she should understand that is how business works - and even more important with family. Without a written agreement this is very likely to morph and tear apart relationships between you and your siblings.
I also support having her pay fair market rent - not just HOA, utilities, etc.. Again, she is 29 years old.
Sorry to hear what your Mom is going thru. Is she really able to decide this is what she wants?
HarveyS is offline   Reply With Quote
Old 03-05-2018, 07:41 PM   #18
Recycles dryer sheets
Ready2Go's Avatar
 
Join Date: Sep 2017
Posts: 78
Quote:
Originally Posted by HarveyS View Post
I also support having her pay fair market rent - not just HOA, utilities, etc.. Again, she is 29 years old.
Sorry to hear what your Mom is going thru. Is she really able to decide this is what she wants?
My niece...unfortunately...is very immature. She's under-employed an would have no chance of paying $1800/month.

Thanks. As far as my mom's cognitive ability, it's bad now. But, she has expressed this wish for years.
Ready2Go is offline   Reply With Quote
Old 03-05-2018, 08:13 PM   #19
Recycles dryer sheets
 
Join Date: Apr 2016
Location: Augusta
Posts: 332
What if the niece has a child? I bet kicking her out then would cause all kinds of family drama.
Yarnstormer is offline   Reply With Quote
Old 03-05-2018, 11:59 PM   #20
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Sunset's Avatar
 
Join Date: Jul 2014
Location: Spending the Kids Inheritance and living in Chicago
Posts: 9,180
Quote:
Originally Posted by Ready2Go View Post
My niece...unfortunately...is very immature. She's under-employed an would have no chance of paying $1800/month.

Thanks. As far as my mom's cognitive ability, it's bad now. But, she has expressed this wish for years.
Oh my..... looks like the opportunity for a new interesting thread...

Or, perhaps convincing mother now is the time to sell the condo, before it goes down in value with rising interest rates. Besides avoiding the cost of probate, it will avoid the renting issues, and maybe mother will need to be spending a bunch of money for help while sister is sleeping/out/working. We know the niece won't be doing it.
__________________

__________________
Fortune favors the prepared mind. ... Louis Pasteur
Sunset is online now   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
Thoughts on buy or lease new car, Technology changing fast rjk514 Life after FIRE 62 01-25-2007 08:50 PM
Poll: Lease vs. Buy Auto REWahoo FIRE and Money 39 04-25-2006 03:15 PM
Question for experienced landlords regarding lease Dude FIRE and Money 24 03-26-2006 03:42 PM
Residential Lease Rates ... Increase? Craig FIRE and Money 3 02-28-2005 02:16 PM
Pay cash from IRA or lease car popyee FIRE and Money 12 05-15-2004 03:28 PM

» Quick Links

 
All times are GMT -6. The time now is 02:06 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2020, vBulletin Solutions, Inc.
×