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I'm soliciting opinions on a possibly bad future decision. How much would you think a life estate interest in an on-premises accessory dwelling unit should discount the value of a property? The unit is one bedroom with a laundry room, attached one-car garage, bathroom and kitchen (all told about a 600 square foot house). Also on the property is the main house that is 4 bedrooms with an unfinished basement. It needs work, and I am assuming fair market value would take that into account, but I don't know how to factor the ADU into the purchase price. We would be buying from my in-laws, with the idea that they would have the right to I've out the rest of their days in the ADU and have access to the shop and yard pretty much as they please, as long as we can make any changes we want to them and have access ourselves to the yard and shop as well. This is also partially so they will have us for support in case of emergency as they are getting older, and so the kids will have their grandparents around.
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Nov 27, 2017 01:34
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thebushcommander posted:I don't know if I should hire and inspector now or wait until our 3 month follow up. I feel like we should live there for a couple months to see if any issues pop up, then have inspector come and check everything and add those to the list. Then do the same thing at the 12 month one for any new issues that might arise. I read this somewhere and it seemed like a better idea than a pre-close inspection because it gives the house more time to settle and roll through a couple seasons to see if anything changes. Thoughts? Closing on dis place the day after the townhouse closes. Going to be a busy couple weeks before Chri'mas I've told this story before, but I'll tell it again because it's relevant here- I closed last year on the 20th of December, and I ran into a serious delay in closing because the lady handling my closing left early for the holidays while I was signing the closing papers. They had to call her repeatedly until she picked up and it turned out there was a missing form needed from the seller's agent that had to be faxed before closing could be completed. However, the bank never mentioned anything about needing this form at any point before or during closing, and it was the first anyone had heard about it. The deal closed, but we all had to stay over an hour longer than necessary because the bank's closing agent decided to get her holiday started early without telling anyone how to handle the closing in her absence. I could have potentially had to wait until after the new year before closing, and that would have really left me on my rear end since I had canceled my lease with my apartment and had to be out by Dec. 31st. Hopefully, none of what I had to deal with happens to you, but it's always a risk doing a big business deal so close to the holidays. Good luck and I hope your bank is less neglectful with its' communication than mine was.
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Nov 27, 2017 01:44
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therobit posted:I'm soliciting opinions on a possibly bad future decision. How much would you think a life estate interest in an on-premises accessory dwelling unit should discount the value of a property? The unit is one bedroom with a laundry room, attached one-car garage, bathroom and kitchen (all told about a 600 square foot house). Also on the property is the main house that is 4 bedrooms with an unfinished basement. It needs work, and I am assuming fair market value would take that into account, but I don't know how to factor the ADU into the purchase price. This has a lot of ways that it would go, as far as looking at it as an investment versus accounting for other aspects of the deal. So you would be looking at the Estate in Remainder, which should be discounted based on how long the Life Estate holder is likely to live if you are looking at this from a pure investment perspective, as well as the lost net income for the ADU after adjusting for differences in marginal expenses/depreciation tax shields over the expected life estate period, as well as any effects this could have on your available financing options. If this isn't purely an investment, then the dollar amount becomes a planning question for your in-laws, you, your spouse and your spouse's siblings for the in-laws's estate and how they want to split up assets after they pass. The possible family effects could be a thing if your spouse's siblings feel that you underpaid, while overpaying will push money into the estate from you which would be split between the siblings later. The exact numbers for any of these effects would depend on your market, but the interpersonal aspects are probably going to be just as important to avoid contributing to a future BWM thread post. A future paperwork issue could come up if the in-laws more to a more intensive senior care facility and leave you in charge of the ADU, whereby they could still have the rights to any rental income from the ADU.
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Nov 27, 2017 04:55
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Last house offered: 356. Appraised: 280 Current house listed: 320. Offered/accepted: 296. Appraised: 260 I really loving hate this appraiser, but let's see if these guys will negotiate some more. I hate this entire process.
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Nov 27, 2017 06:07
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crazypeltast52 posted:This has a lot of ways that it would go, as far as looking at it as an investment versus accounting for other aspects of the deal. There is only one other sibling, and we would not enter into this if he objects and want to make sure he is 100% onboard with whatever we do. Given the situation with the health of my in-laws, we honestly think that within 10 years we would be trying to buy somewhere else with an ADU if we don't buy their place when they are ready to sell. As far as the paperwork issue, I am actually pretty worried about if one o them (probably my mother in law since she is younger and a noncompliant diabetic) winds up on medicaid in a care home or something. That's why I am trying to figure out now how much we should expect to knock off the price. I figure if we can document "The life estate should be worth this much of the property value" then we should hopefully be able to prevent an unwinding of the sale. If we go that route I think we would want to get an attorney and some sort of expert involved to determine an exact figure and make sure we handle it correctly. The more I think about this the more I think it may be better to buy our own house with an ADU and just let them live in it rent free. BWM, but good with everything else.
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Nov 27, 2017 06:24
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totalnewbie posted:Last house offered: 356. Appraised: 280 I mean it sounds like that bank just isn't interested in financing that house for whatever inscrutable bank reason
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Nov 27, 2017 13:22
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I just think this appraiser is an rear end in a top hat.
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Nov 27, 2017 13:57
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totalnewbie posted:Last house offered: 356. Appraised: 280 My house appraised for 308 which was 3k over my offer so can't fault my agent for that price estimate. Closing on Thursday then booking someone to come replace the leach field and a bunch of other things from the inspection before moving in. Cancelling my lease is going to suck but then they have you by the balls so what do you do.
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Nov 27, 2017 14:08
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Vinny the Shark posted:I've told this story before, but I'll tell it again because it's relevant here- Luckily the closing is a few weeks before Christmas. I actually already spoke with the closing agent at the lawyers office. She's received all closing documents and keys. So now it's just a waiting game. Still have walk through with the builder and then final walk through the afternoon before we close. Went to the house yesterday and made a nice long list of things for them so when I do the walk through I am prepared with notes for each room. Luckily, most of the things are stupid, like two of the doors don't latch properly when closed. Had a buddy come walk it with me who works in residential construction and he found some additional things like the trash pull out drawer in the kitchen island doesn't close all the way before there is an electrical outlet and wires in the back that hit the back trash can lip stopping it. Felt pretty good about the homes ability to hold heat though, they haven't even turned on the heat at all and it's been low 30's at night and low 50's in the day for the last week, but the thermostat said 60 when we went while it was still only about 45 outside, so that's nice. Might be a stupid question, but is it unheard of for a contractor to rush something like carpet install and completely forgo the carpet pad? There is supposed to be a 6lb pad under all carpet and I swear I can't feel anything but solid below the carpet.
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Nov 27, 2017 15:44
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therobit posted:If we go that route I think we would want to get an attorney and some sort of expert involved to determine an exact figure and make sure we handle it correctly. No matter what you do, you need to involve an attorney, maybe two! This is a complicated matter with various tax, estate, and God knows what complications. A real estate attorney is a cheap hedge against the unknown. An estate planning attorney can provide useful guidance and much needed will/trust documents to help you come out ahead. All three parties should be at the table (parents, yourself, your sibling) to make sure it doesn't wind up with a bunch of bad with feelings down the line. The advice on how this works varies by state, asset levels, and long term health care plans.
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Nov 27, 2017 16:14
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What is the current recommendation for comparing rates? A credit union, a big bank, and an internet lender? Anyone specific in that last category? A local bank my agent referred me to gave me a 4% and 3.875% options on a 92k loan. the littlest prince fucked around with this message at 17:55 on Nov 27, 2017 |
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Nov 27, 2017 17:52
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the littlest prince posted:What is the current recommendation for comparing rates? A credit union, a big bank, and an internet lender? Anyone specific in that last category? The internet broker is going to be giving you offers from all sorts of banks, there's really no gain by also asking a big bank. The only reason you wouldn't just compare a few internet brokers and nothing else is if you have a relationship with a financial institution already and it's worth thousands of dollars over the course of your mortgage to work with them instead of whatever random bank the internet broker sells your loan to. You can check internet brokers on Redfin.com (or Zillow, or many other sites). A couple of us have used Aimloan, but I would still pick a better rate over going back to them.
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Nov 27, 2017 19:38
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the littlest prince posted:What is the current recommendation for comparing rates? A credit union, a big bank, and an internet lender? Anyone specific in that last category? Zillow mortgage lenders. We refinanced a while back and I went with the first result from Zillow. I sent the loan offer info from them over to my credit union that we had gone with for the original loan and the agent told me she couldn't touch the offer and to go with the internet lender.
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Nov 27, 2017 19:49
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Economic Sinkhole posted:I sent the loan offer info from them over to my credit union that we had gone with for the original loan and the agent told me she couldn't touch the offer and to go with the internet lender. This is exactly what my local bank said to me, they were 0.75% off.
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Nov 27, 2017 19:56
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the littlest prince posted:What is the current recommendation for comparing rates? A credit union, a big bank, and an internet lender? Anyone specific in that last category? I closed a few weeks ago at 3.375% on a 30 year fixed. All the best rates I got were from big banks (3.375, 3.5, 3.625) with no points. I also did shop local mortgage brokers who gave me uncompetitive rates (4.0, 4.25). Unlike the big banks, they declined to compete rate wise when I told them I had more competitive offers. I also got various rate quotes from other big banks and internet lenders (HSBC, Quicken Loans, random Zillow references). I was able to leverage relationship discounts with banks, which really helped. Dealing with a big bank (when we were actually funding the loan) was a pain in the rear end in terms of slow customer service, endless documentation requests, and ultimately, a delayed closing. Luckily the seller and I were in no rush to close. Hope this helps.
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Nov 27, 2017 20:32
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Guy I got from Zillow has been spot on.
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Nov 27, 2017 20:35
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Better.com worked great for me. Found them through zillow. Just get a bunch of offers. It doesn't hurt you.
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Nov 27, 2017 21:05
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Zillow and Redfin aren’t showing anything significantly better under ‘mortgage rates’ but I went through the Zillow ‘mortgage lenders’ thing and they had one guy contact me. Is this the right thing I should be doing?
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Nov 27, 2017 21:39
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I just plugged it in for a couple different states and you're right, there's really nothing available. My guess is that your loan amount is just too small for the internet lending market. I'm surprised by that but TIL.
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Nov 27, 2017 21:45
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Mandalay posted:I closed a few weeks ago at 3.375% on a 30 year fixed. That's insane, which bank if you don't mind me asking? It doesn't make any sense for them to offer that without huge origination fees.
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Nov 27, 2017 23:21
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baquerd posted:That's insane, which bank if you don't mind me asking? It doesn't make any sense for them to offer that without huge origination fees. Sent you a PM. My realtor expressed surprise at how low the rate was, but the second-lowest bank was within an 1/8th of a percentage, so it wasn't that much of an outlier.
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Nov 27, 2017 23:49
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We (sellers) signed our closing documents and sent them off. Buyer is supposed to close on Wednesday. He's been an absolute poo poo the whole time, so I'm hoping everything goes smoothly. Finally going to be out from that house!
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Nov 28, 2017 01:15
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I close tomorrow, here's hoping this isn't a big mistake.
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Nov 28, 2017 01:28
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First time post here, proud to say I've unofficially purchased a home. Offer was accepted, appraisal is done, earnest money is banked and all's I'm waiting for is the official loan approval. Which...kind of has me worried.Today the lender says they need a letter of explanation for a 5 month employment gap I had last year. How serious are those inquiries? Can I say something like "my relative died" and leave it at that? For what its worth I have no debt (other than a bit on the credit card) and my score is "excellent." And I have everything ready to make a downpayment.
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Nov 28, 2017 03:42
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Yeet posted:First time post here, proud to say I've unofficially purchased a home. Offer was accepted, appraisal is done, earnest money is banked and all's I'm waiting for is the official loan approval. Which...kind of has me worried.Today the lender says they need a letter of explanation for a 5 month employment gap I had last year. How serious are those inquiries? Can I say something like "my relative died" and leave it at that? Do not lie. You can call the underwriter and ask, but overall: terminated (in)voluntarily due to lay off/fired/quit, started new job date. If you quit say you took a vacation between jobs you had lined up or whatever. One or two simple sentences is likely all they need.
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Nov 28, 2017 04:56
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If your relative died, and you needed time off for family/to grieve, that is fine. Likewise you can say you were laid off or whatever and it took you a while to find a job. They are not going to verify if you were laid off or fired, and they don't really care as long as you explain the reason for the gap, even if it is "I took a while to find a new job." They have to get an explanation of the gap due to federal mortgage regulations. If you say you were in the military or in school, they will want records of that, but if you say you were out of work and couldn't find a job then they won't ask for anything else.
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Nov 28, 2017 05:06
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totalnewbie posted:Last house offered: 356. Appraised: 280 Sold: 350 (not to me) The sellers offered to go down to 285. I considered challenging the appraiser to increase the appraised value, but I don't think that is really useful IF I have the cash to make up the difference, which I do. I still think the appraiser is full of poo poo (though not as much as last time); it's the same guy as before. I figure, in the end, it's the final sale price that matters, not the appraised value or my loan amount. If I buy at 285 w/ a 260 loan vs. a 270 loan, it's not a big difference, is it (except for money in the bank for me right now). I think I will ask the sellers to go down to 280 (I think they'll take it - if not, I can still do 285) and call it a day. 320 -> 280 (or even 285) would be a pretty good deal, I think. Is this completely stupid or just mostly stupid?
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Nov 28, 2017 07:34
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totalnewbie posted:Is this completely stupid or just mostly stupid? I bought a house for $500k and the appraisal came in at $490k, presumably because post-2008 all the worthless appraisers that used to rubber stamp everything have to look like they are actually doing something now, so they randomly come in with a value other than the closing value. I just had to come up with an extra $8k at closing to keep the mortgage at 80% of appraised value. If you like the house and are pretty sure the appraiser is a moron, then I wouldn't worry about the appraisal at all.
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Nov 28, 2017 08:15
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And just for clarification - my current appraisal for the bank (conventional loan) will mean absolutely nothing after I buy the house, correct? And if I get the appraisal up, nobody but my bank and me knows, right? totalnewbie fucked around with this message at 15:58 on Nov 28, 2017 |
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Nov 28, 2017 15:49
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totalnewbie posted:And just for clarification - my current appraisal for the bank (conventional loan) will mean absolutely nothing after I buy the house, correct? How does your locality do property taxes? Mine happened to use the sale price.
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Nov 28, 2017 16:40
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City Website posted:The Assessor is constitutionally required to set the AV at 50% of the usual selling price (or true cash value) of the property. Looks like selling price.
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Nov 28, 2017 16:49
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I'm starting to stress the gently caress out, now. Wife has bad credit, so I have to close the sale on my home and the purchase of my new one on the same day. All our contracts (both with my buyer and my seller) were targeting Nov 30 for the closing days. I got all my poo poo in line to be ready to have my mortgage ready to go on that day. Last week my lawyer tells me that the buyer for my place hadn't gotten their mortgage commitment yet so there's no way we're closing on Nov 30. They wound up getting their commitment the day before thanksgiving, so that's good. Now it's Tuesday and my lawyer called to let me know they haven't heard anything further from the buyer's attorney, and early access to the house i'm buying isn't going well because THEY'RE doing the same thing I am, trying to close two transactions on the same day. gently caress. So now we're just waiting in limbo for the buyers to get off their rear end and look to get a closing date in mind. Buyers chipped me down way further than I wanted to, and tried to gouge me for even more by having some bullshit artist tell me that the place needed $10k worth of roof work. No it doesn't. Eat my dick. At least my worthless realtor came through, had another contractor take a look and say their estimate is insane and it's a 4k fix max. I hope my current house collapses on these people the day after I'd not be liable for it.
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Nov 28, 2017 18:12
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totalnewbie posted:The sellers offered to go down to 285. I had my realtor offer 278 this morning. I probably could have asked lower but might have ended up negotiating to 278 anyway, which would be splitting the difference between initial agreed price and appraisal. As for talking up the appraisal, I figure, I have the cash to cover so there's really no point. I'll pay this money now or later, regardless. I'll end up putting "11%" down but only getting credit for 5% in my mortgage but in the grand scheme of buying a house, I don't think I need to be too worried about the extra PMI (else I shouldn't be buying this house in the first place). Hopefully no other fuckery ends up happening.
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Nov 28, 2017 21:27
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H110Hawk posted:Do not lie. You can call the underwriter and ask, but overall: terminated (in)voluntarily due to lay off/fired/quit, started new job date. If you quit say you took a vacation between jobs you had lined up or whatever. One or two simple sentences is likely all they need. Thanks to both of you! Yeah I figured telling the simple truth is best, not that I have anything shady to hide anyway. My financial guy said that (in my case) its more of a formality, I was already approved and they just needed to fill in something. Unless of course I said super ridiculous.
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Nov 28, 2017 23:20
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Removed cabinets from the garage. Found a bunch of mold outside. There’s probably more mold inside. We’ll find out when we tear our the drywall. Seller didn’t disclose. gently caress. 
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Nov 29, 2017 05:51
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Finally signing the contract today  My lawyer tells me that the seller opted to provide a Property Condition Disclosure which according to him is a bonehead move. His experience with this form is that it opens them up to lawsuits should there be an issue in the house and I can somehow provide proof they knew about it. For example, they disclosed the basement has never flooded. If it does and I can get an affidavit from a neighbor saying this has happened before, then I can take them to small claims and win.
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Nov 29, 2017 19:12
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Took 20 minutes to close and the previous owner was flipping out as she hadn’t moved out yet. So I now own a house and have joined the ranks of the damned.
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Nov 30, 2017 16:49
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Wait so you went through with the closing even though the owner hadn't moved out? Did you do a final walk-through?
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Nov 30, 2017 16:52
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Lol she's moving out of a house she has no financial responsibility for. Shed a quick tear for the abused corners and door frames, and hope none of it is bad enough for you to have to replace.
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Nov 30, 2017 17:35
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Judge Schnoopy posted:Lol she's moving out of a house she has no financial responsibility for. Shed a quick tear for the abused corners and door frames, and hope none of it is bad enough for you to have to replace. Totally agree. I would have never done the final walk-through or closing if her poo poo wasn't out already.
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Nov 30, 2017 17:52
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