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What To Do?

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TiffanieBreaud

Freshman Member
Joined
May 14, 2003
First, a little on my story. I live in a home owned
by my mother and father. Neither of which lived in
the home for over three years. My father is willing
to "give" me his portion of the home, which was never
divided in court after the divorce in 1995. My mother
wants her portion of the "gold mine". I am interested
in purchasing the home from them with the idea that I
will only be buying out my mother's portion, and
relieving my father of his debt to Hibernia. I don't
believe the house has much value in the condition it
is in. I am trying to improve some of the damages,
but with the home belonging to my parents, I obviously
cannot get financing to do some of the repairs. Also,
my father cannot refinance without my mother's
signature. The purpose is to find the value of the
home and figure my mother's portion.

I looked over your web site quite extensively, but
must admit I do not understand everything. I have seen on some of the web sites that it is quite costly to have an appraisal done, and
would like to hear anyone's comments on the situation at
hand. I realize that you cannot give me any dollars,
but with your professional expertise in the field I
would like to know if this approach is advisable.
 

Judy Whitehead (Florida)

Senior Member
Joined
Jan 20, 2002
Professional Status
Certified Residential Appraiser
State
Florida
First of all, having been through a divorce myself years ago, I cannot imagine that the divorce decree did not spell out what was to be done with the jointly owned property.

This is my personal opinion only, but if it were me I wouldn't spend a dime on the property until it was either in my name, or under contract to be in my name. I would assume you can "purchase" the property from your parents, even with $0 going to your Dad, but I'm not an attorney, so I'd check with one to be sure. The purchase could be "subject to the appraised value."

If you want to know how much an appraisal costs, the figures I have seen for a typical appraisal run between $250 and $350. Most of it depends on how much work has to be done. If the home is appraised it will typically be appraised "as is" and the poor condition would be mentioned on the report, which will probably scare off most lenders (if I were loaning my money it sure would.)

It sounds to me like one of the parties (Mom) would be likely to throw a monkey wrench into whatever you decide to do. But....if you could get her to agree to receiving half the appraised value - subject to the appraisal and obtaining a mortgage, in writing and with a binding contract, then perhaps that would solve your problem.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
EeeUck, messy situation. Maybe do kind of like relocation companies do. Get Dad to get an appraisal, and get Mom to get an appraisal. Then compare the two. If they are within 10%, split it down the middle as an agreed upon price. If they are out of spread by 10%, get a third appraisal to help determine which is out of line.

Good luck, I know what it is like to loose old family property because the other side saw the gold mine....... except I could not afford the $1million price tag :(
 

Restrain

Elite Member
Joined
Jan 22, 2002
Professional Status
Certified General Appraiser
State
Florida
What I have seen is that in the event of a sale, the equity is split between the two parties. Given that neither have seen fit to sell, I would get an agreement signed by both to sell the home to you and split the equity, if any. As part of the agreement, I would get a list of several appraisers (I would suggest members of the Appraisal Institute, American Society of Appraisers, or National Association of Independent Fee Appraisers) or other appraisers who have a high regard in the local profession. Then they each could pick one and, if within 10%, split the difference for the sales price. But I would get an agreement before doing anything. And don't spend anything on the home until it's yours.

Good luck.
 
Joined
Jan 13, 2002
Professional Status
Retired Appraiser
State
Florida
I'm surprised that someone hasn't yet said that you might have some trouble getting a mortgage depending upon what repairs are needed. You might consider a FHA 203 rehab mortgage.

Just don't let some loan officer talk you into having an appraisal completed that will ignore those repairs as it will be higher than the actual value of that property. If you then use that appraisal for the purchase price, you've just paid more than it's worth and will likely be upside down in your mortgage. Get a realistic appraisal or 2 as suggested above. Hopefull, you can have Mom pay for one and Dad pay for another one since they normally would have had to do this for the divorce for a settlement.
 

Mountain Man

Elite Member
Joined
Jan 15, 2002
Professional Status
Certified General Appraiser
State
Georgia
Pam,
You're right, if you try to finance via conventional means. But first thing is first........ get ownership! I'd go to a local bank for an in-house "swing" loan, to buy and fix it. Then see about re-financing.
 

Mike Garrett RAA

Elite Member
Gold Supporting Member
Joined
Jan 14, 2002
Professional Status
Certified Residential Appraiser
State
Colorado
Before spending any money on an appraisal...get an agreement between the two of them to sell it to you and split the equity. If they can't agree I would recommend you forget the deal and move on. These usually get ugly, should have been settled at the time of divorce.
 
W

walt kirk

Guest
Tiffanie,
Go to a lawer whose specialty is real estate. There are several ways to accomplish your goal and a real estate lawyer can advise you best. You may want to order a title report to determine any change in ownership or liens on the property since the divorce. You may want to purchase the property with an FHA 203 K mortgage which finances the purchase and repairs and upgrades. You may want to purchase your father's share of the property for $1 and become co-owner with your mother.
 
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