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phuongy · Dec 19, 2009, 07:56 AM

My only son (from my previous marriage) got married. My husband and I bought another house and transfer the deed and the mortgage balance of the old house to my son and his wife. They are now legally owners of that house but it was a mutual agreement that my husband and I still have 20% ownership interest in that house.

If my son dies and has no children, and his wife does not want to honor the agreement, what should I do?

excon · Dec 19, 2009, 09:21 AM

Originally Posted by phuongy

If my son dies and has no children, and his wife does not want to honor the agreement, what should I do?

Hello p:

You should reduce your agreement to writing. Then it wouldn't matter if she wanted to honor it or not.

excon

Fr_Chuck · Dec 19, 2009, 03:59 PM

If you are husband are not listed on the deed as 20 percent owner, you are not and there is nothing you can do. This needs to be in writing or it does not exist.

Also how did you "transfer" the mortgage to them, never heard of that, did they do a refi ?

phuongy · Dec 20, 2009, 08:20 AM

Yes, they refinanced the house. Can we do have a written agreement regarding the ownership but not listed my husband and my name on the deed or the mortgage?

excon · Dec 20, 2009, 08:50 AM

Hello again, p:

Yes, of course, you can and SHOULD have every detail memorialized in writing...

The Padre asked the question he did, because the mortgage company IS part of any deal involving the house that THEY'VE invested in...

Specifically, you didn't "transfer" the deed and mortgage. You SOLD the house to them, and they got their own financing... The problem is, apparently the mortgage company doesn't know about your 20%. If your agreement WAS in writing, they WOULD know about it. But, it isn't, and they don't. They think, that if your son defaults, they'll own the ENTIRE house. But, you own 20%, and that's going to cause trouble with the mortgage company.

So, at this point, your personal agreement with your son notwithstanding, I don't know whether you OWN 20% or not.

In any event, in order to secure your interest, if you can, you're going to need the services of a real estate attorney.

excon

ScottGem · Dec 20, 2009, 09:04 AM

Unless there is some agreement in writing that you and your husband own 20% then you don't.

I'm curious as to the conditions in which the property was transferred. I assume they paid you nothing for the house, but instead got their own mortgage and then paid off yours. If the "sale" (and it was a sale) was not for a market value price, the IRS may consider part of the sale a gift and you may incur gift taxes.

You should have researched this fully before going through this transaction, now I would suggest consulting with a real estate attorney to straighten it out.

Fr_Chuck · Dec 20, 2009, 02:02 PM

If this was me, I would put a second mortgage on the home to the value of 20 percent of the home, that way, you have a written interest in the home.