My mother died in 2006, leaving behind my father who could not take it well take care of yourself. My sister had lived in Hawaii, but the cost of life there had grown and income opportunities had shrunk, so she moved came to my father in Oregon in 2008 to help him until he died in 2010.
The house was left to the two of us in trust. She lived there rent free for 11 years, including property taxes and repairs.
We both live on our social security, which is scarce for me, but impossible for her to live, since a permanent position was not her strong point, and was moving a lot. The house is worth somewhere in between $ 400,000 and $ 500,000. The proceeds from the sale would split these between us.
Again and again she finds reasons why the house is not suitable for sale. That delay has moved us to soaring real estate costs, which means she can’t afford anything with her half.
I’ve put down roots since I bought my first home when I was old 23, so now I live in a paid off house. She doesn’t recognize my need for the proceeds from the sale of the home.
I love my sister, but I don’t feel responsible for the fact that she never did acquired from anything in 70 years. She says, “This house is all I have. “
I feel like I’ve been very patient for 11 years, but I feel that financial pressure in old age. I don’t want my sister to be homeless and i don’t want to alienate her but i don’t know what to do next.
I don’t think you have only two options here to make your sister homeless or to let her live rent free forever. She would have $ 200,000 or $ 250,000 off her half of the home sale. Property prices may be spiraling out of control right now, but not so much that she couldn’t afford a modest one-bedroom apartment.
In a perfect world, you could do something called a cash out refinance. You would get your half of the equity in cash while your sister would take out a 50% home value mortgage.
“Most lenders would typically approve such funding even for borrowers with poor credit ratings and limited income or assets, as a 50% mortgage lending value poses very little risk to the lender,” said David Reischer, Attorney and CEO of LegalAdvice.com who specializes in real estate and mortgage law.
The big problem, of course, is that your sister lives on a meager social security income. She can’t even afford a small mortgage payment.
The extreme approach goes to her sister in court. “If one co-owner wants to sell a house and the other person doesn’t, most state laws allow the co-owner who wants to sell to force the house to be sold by asking the court to sell,” Reischer said. “The court oversees the sale of the property and ends with the distribution of the sales proceeds.”
This process can usually take anywhere from six to twelve months. Of course, the damage to your relationship can go on forever.
Her sister has lived rent-free for 11 years. She has every reason to keep making excuses. She will not voluntarily give up this arrangement.
I think you should let her know that if she is not cooperating with you, if she is not cooperating with you, you will at least consider taking the matter to court. Tell her you really don’t want this. But tell her that after 11 years you fear that this may be your only option.
Try not to focus on your sister’s bad decisions while having this discussion. Instead, focus on what you need, that’s your half of the equity in the house your father left you both with. Stand firm when she says the house is all she has. Maybe that’s true. But she can get away with half the proceeds from selling a house in a hot real estate market. If she insists there is nowhere to go, point her out of some Zillow deals that would be within her budget.
Perhaps with some pressure, your sister will be more motivated to either sell or find a way to make a small mortgage payment. Could she rent a room in the house to make money? Or could she take a part-time job?
If your sister still refuses to move, it is up to you to decide whether to actually take her to court. Ultimately, you must choose whether to sacrifice your relationship with your sister in order to receive your share of this home. Hope this is a decision you don’t have to make.
Robin Hartill is a certified financial planner and senior writer at The Penny Hoarder. Send your tricky money questions to [email protected].