Hi there, I just recently got engaged and learned that my fiancée co-owns his home with his parents. His parents put in a down payment cash and my fiancée took out a loan pays the rest of the mortgage monthly. My question is, could the parents charge us rent for their share of the home if they do not live with us? Would we have to have their permission to sell the home if choose to in the future? Could this hurt me if I marry into this? Just trying to figure out things before I get married. Thanks!

I don't think they could charge you rent if your fiance's name is on the deed. They may ask that you pay the money back that they gave as the down payment. If you go to sell the home or refinance it (taking them off the title), they would have to sign the deed when title is transferred

NO, they can not charge you rent, but then they can legally come and enter the property also unless you have some written agreement.

Also how is the deed written, for example if he dies first, would house go completely to them at death, or would you end up owning 1/2 a house with them.

But yes, if they are on the deed you and your husband can not sell the house without their permission, they have to also sign the deed.

But now this is very common when they pay a large down payment, this protects their money, since he can not sell house without paying them back first.

Hoy boy, what a mess.

The problem comes in that you have three people on the title It doesn't matter so much who is on the loan, in my humble opinion. If you get married and want to sell the house, his mom and dad have to agree and sign papers. There are capital gains taxes to consider. Who is getting the appreciation of the equity? What if you don't get along with your future mother-in-law and father-in-law at some point. What if there is a job transfer? I would much rather see your future mother-in-law and father-in-law lend the money and hold second position on a Deed of Trust (Mortgage) than be co-owners. They are still protected, but your fiancé calls the shots as to when to sell the house. Time for this fiancé to "wake up and smell the humus."

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Originally Posted by NewlyEngaged

Hi there, I just recently got engaged and learned that my fiancee co-owns his home with his parents. His parents put in a down payment cash and my fiancee took out a loan pays the rest of the mortgage monthly. My question is, could the parents charge us rent for their share of the home if they do not live with us? Would we have to have their permission to sell the home if choose to in the future? Could this hurt me if I marry into this? Just trying to figure out things before I get married. Thanks!

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Everyone has given excellent advice but you also have to look at a situation where you are presumably contributing to "your" household but have no ownership in the property.

Your fiancé never mentioned this before?

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could the parents charge us rent for their share of the home if they do not live with us?

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My answer to this would be no. Since you fiancée co-owns the home he has rights to occupy it without having to pay any rent to the other party (his parents.) The only possible exception would be if the parents single-handedly pay the mortgage, then they could charge him rent to cover the mortgage payments.

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Would we have to have their permission to sell the home if choose to in the future?

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Yes. Since they co-own the home, they would have to consent to the sale and receive a portion of the proceeds.

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Could this hurt me if I marry into this?

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Not sure what you mean by this question. It will not result in any potential legal liability on your part. If you occupy the home with your husband-to-be then it becomes your family home and you'd be given the usual interest in his share of the home. It just wouldn't be as big an interest as it would be if he owned the home strictly on his own.

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Originally Posted by s_cianci

My answer to this would be no. Since you fiancee co-owns the home he has rights to occupy it without having to pay any rent to the other party (his parents.) The only possible exception would be if the parents single-handedly pay the mortgage, then they could charge him rent to cover the mortgage payments.Yes. Since they co-own the home, they would have to consent to the sale and receive a portion of the proceeds.Not sure what you mean by this question. It will not result in any potential legal liability on your part. If you occupy the home with your husband-to-be then it becomes your family home and you'd be given the usual interest in his share of the home. It just wouldn't be as big an interest as it would be if he owned the home strictly on his own.

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If you are saying OP would be given the "usual interest in his share of the home" in the event of his death, it depends on the Deed. This is also property owned prior to the marriage and exempt in the event of divorce in many, many cases. Partial ownership to the OP is not a given.

Thank you all so much for your answers. You have been extremely helpful!! I really appreciate it.

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Originally Posted by pacific nw

Hoy boy, what a mess.

The problem comes in that you have three people on the title It doesn't matter so much who is on the loan, in my humble opinion. If you get married and want to sell the house, his mom and dad have to agree and sign papers. There are capital gains taxes to consider. Who is getting the appreciation of the equity? What if you don't get along with your future mother-in-law and father-in-law at some point. What if there is a job transfer? I would much rather see your future mother-in-law and father-in-law lend the money and hold second position on a Deed of Trust (Mortgage) than be co-owners. They are still protected, but your fiance calls the shots as to when to sell the house. Time for this fiance to "wake up and smell the humus."

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Thanks so much for your answer. I was wondering about holding a second position on a Deed of Trust. By this, in the public records would his parents' names show up also or only his name. Do you know if they lend us the money in this way, would we have to pay taxes on money they lent us? And if we had decided to do something like this now, would that mean we would have to "sell" the house and buy it from them with the money they lent us? Very confusing. Just want to make sure I don't get myself into a situation where we are indebted to his parents and don't have the freedom to do what we would like in the future. Really appreciate your time.

If this money is considered a loan, using the house as security, which it is by putting their names on the deed, it is not a gift and no taxes should be due.

And they are lending you the money, so of course you are indebted to them. And no you will have to have their permission to sell the home.
Since their names is on the deed, it will be public record.

But to be honest, if you want to buy a home you can't afford without them giving you the money, perhaps you should not buy it

There are a couple of considerations:

The parents could Quit Claim off the title in exchange for a Deed of Trust drawn up by an attorney. (Mortgage depending on the state). This would be a typical lender/borrower arrangement. They would have to agree to do so. There may be a reason they chose to be on title. You'd have to ask them. They may simply not realize the complexity they add to the issue. They may or may not be subject to capital gains taxes. Talk to a CPA.

Your fiancé could refinance in his name only and pay off the existing mortgages. The parents would have to agree to a Quit Claim deed (or perhaps a Warranty Deed, depending, talk to a title company) to get them off title. Talk to a mortgage broker in your area and discuss the issue to see if it is even an option to refinance at this point.

The things to consider:

1) How much money do the parents have in this investment? (Since they don't live there, to them it is an investment property.)
2) Why did they chose to do the transaction the way they did?
3) Did they use an attorney? The attorney can answer a lot of these questions.
4) How long have they been on title?
5) Are they willing to sign Deeds to get off title if they are "cashed out"?
6) Is this part of their retirement "fixed" income? (payments from your fiance)
7) What are their tax implications?
8) Are the parents even willing to discuss it?

There is no way to get their names off the title without their co-operation. They may wonder why a fiancé may be interested in doing so.