U.S. CitiesCity-Data Forum Index
Covid-19 Information Page
Go Back   City-Data Forum > General Forums > Economics
 [Register]
Please register to participate in our discussions with 2 million other members - it's free and quick! Some forums can only be seen by registered members. After you create your account, you'll be able to customize options and access all our 15,000 new posts/day with fewer ads.
View detailed profile (Advanced) or search
site with Google Custom Search

Search Forums  (Advanced)
Reply Start New Thread
 
Old 07-31-2012, 03:35 AM
 
4 posts, read 4,523 times
Reputation: 10

Advertisements

Hello,

My ex-husband recently passed away in February (cancer) and he left his house to the kids (son 21, daughter 18). Both of them are in college and are getting financial aid plus scholarships. At this time they do not work but instead focusing on getting through school full time.

My son and daughter still live in my home because the cost to dorm is outrageous. Their father never supported them financially and I have been unemployed since 2010. I was actually shocked that he left the house to the kids.

The house is new construction, legal two family in Queens, New York. The area is very diverse and is in walking distance to the park, restaurants, public transportation, etc.

Their father bought the house in 2005 (when all of the house prices were inflated) for $1,015,000.

Right now since we cleaned the house and it is completely vacant the kids decided to put it on the market to see what happens. The highest offer is $1,128,000. The Real Estate wants 4% if they sell the house, which is about $45,000.

There are no liens on the property but there is a $190,000 mortgage....the monthly payment is about $1,900.00. The taxes are $6,000 a year but I think it is included in the mortgage payment (escrow?).

Also, their father does have some bills left that have to be paid such as hospital bills, credit cards, etc but so far no big THOUSAND+ dollar bill has come in the mail yet....just a lot of hundred to two hundred dollar bills that do add up.

I'd say a safe number would be $30,000 in total for all of my ex-husband's bills.

Both of them talked it over and my son and daughter both decided they want to invest LONG TERM and don't need the money right away.


Now the kids are thinking....what is the best & safest investment?

Selling the house and putting the money into the stock market or trust fund which could be risky? We would have to contact a financial adviser because none of us know about the market.

OR

Keep the house and rent it?

The first floor can be rented for $2,000/month, second floor, $2,500/month.

Since the kids are not working and have virtually no significant credit line they would never be able to buy this kind of house by themselves at least in the near future or get a good mortgage rate like the one that is already in place.

If the mortgage owed was $500,000+ then I think they should sell but since the mortgage is so low and can be paid off in 4-5 years via rental income I think they should keep the house for investment.

Please let us know your opinions. Thank you and god bless.
Rate this post positively Reply With Quote Quick reply to this message

 
Old 07-31-2012, 06:14 AM
Status: "But in the aggregate..." (set 29 days ago)
 
Location: The Triad (NC)
31,335 posts, read 69,519,228 times
Reputation: 37344
Did the ex name an executor for his estate? Or has the Orphans Court there named one?
Since the February death... has probate closed?

Quote:
...completely vacant the kids decided to put it on the market to see what happens.
The highest offer is $1,128,000.
Call those people back and SELL!

After the mortgage balance (not mentioned by you) and all other bills are paid off...
ideally it will be the Estate who sells and the Estate which gets the left over money.
Depending on how much that is... the focus for it should still be getting the kids through college.

The Estate could distribute allowances for tuition and expenses until school is over,
and a nice "gift" upon graduation (relative to GPA). X years post graduation get the rest.
---

As for renting it? No. An 18yo and a 21yo in college are in no position to be landlords.
Even with a professional property manager or a helpful mother who might volunteer her
time to "keep an eye on things" for them... No.

The best thing they can do is
1) keep the money in the estate, and
2) have the estate invest for growth and,
3) have the estate distribute allowance checks to the kids
(keep the kids solvent until they are finished with college and onto careers) and,
4) have the kids get involved in the professionally managed investment decisions.

Soon enough (if the other numbers are correct) they'll each have a nice $500,000+ portfolio.
That'll have them head and shoulders above 90% of twenty-somethings.

Last edited by MrRational; 07-31-2012 at 06:38 AM..
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 06:39 AM
 
4 posts, read 4,523 times
Reputation: 10
Quote:
Originally Posted by MrRational View Post

After the mortgage balance (not mentioned by you)
$190,000 is the balance and my son is the executor.

The kids right now are fine regarding college expenses. Scholarships have helped them a lot and their hard work has paid off so far (and still is).
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 07:10 AM
Status: "But in the aggregate..." (set 29 days ago)
 
Location: The Triad (NC)
31,335 posts, read 69,519,228 times
Reputation: 37344
Quote:
Originally Posted by SCCC View Post
$190,000 is the balance and my son is the executor.
Even with people who have the time and seek being LL's...
they don't start with a single million dollar property.

Liquidate, invest for growth, get through school and into careers...
THEN decide the best use of the nest egg.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 07:21 AM
 
Location: home state of Myrtle Beach!
6,413 posts, read 20,267,999 times
Reputation: 3628
Yes, I agree, unload the property, try to get that buyer back on the line. Invest the money and pay off any school loans the kids incur and don't give them immediate access to the balance if you can help it; they'll spend it. If Dad has unpaid child support this would be a good time for that bill to be paid too!

Enlist a financial planner to help. You can get some good ideas from Suze Orman internationally acclaimed personal finance expert : The Suze Orman Show : Will & Trust Kit : FICO Kit : Women & Money
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 09:48 AM
 
Location: Chicago
3,259 posts, read 5,706,547 times
Reputation: 3904
I agree that they should just sell. It sounds to me like renting it would be a nightmare. Where do your kids go to school? Is the property prepared to be rented into two separate apartments? It sounds to me like its probably just a single family home that cannot legally be split into two apartments. Regardless, your kids have enough stress in their lives from losing their father and completing school. Don't add more by holding onto a rental property. Have them focus on their own careers and getting their own thing going.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 11:22 AM
 
4 posts, read 4,523 times
Reputation: 10
Quote:
Originally Posted by ChiGuy2.5 View Post
Is the property prepared to be rented into two separate apartments? It sounds to me like its probably just a single family home that cannot legally be split into two apartments.
Yes the property is prepared to be rented into two separate apartments, it is LEGAL TWO FAMILY.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 01:20 PM
 
Location: Mid-Atlantic
29,041 posts, read 28,029,624 times
Reputation: 36600
They don't have to pay his CC bills. Don't mean to sound crude, but dead people don't have CC bills. Write that one off.
Rate this post positively Reply With Quote Quick reply to this message
 
Old 07-31-2012, 01:27 PM
 
Location: State of Superior
8,729 posts, read 14,580,647 times
Reputation: 2851
Quote:
Originally Posted by SCCC View Post
Yes the property is prepared to be rented into two separate apartments, it is LEGAL TWO FAMILY.
Hands down, rent it out ! The problem these days is there is a shortage of rental properties, and now in some emerging markets home builds and property.This may be their only chance to make it work big,, for a long time. Count your blessings, considering you have not worked for over 2 tears ! Owing stuff is great but owing an income producer is even better. cash has a way of disheartening a lot of " savers" in a few short years.Keep the money flowing, I am sure thats what their father was thinking.......
Rate this post positively Reply With Quote Quick reply to this message
 
Old 08-02-2012, 08:24 AM
 
Location: California / Maryland / Cape May
1,548 posts, read 2,679,469 times
Reputation: 1241
Quote:
Originally Posted by Gerania View Post
They don't have to pay his CC bills. Don't mean to sound crude, but dead people don't have CC bills. Write that one off.
Gerania, perhaps I'm misreading your statement, but yes, the deceased have bills and they are typically allowed to be collected against the estate prior to distributions. That has been my experience four times over, any way.

To the OP, I am truly terribly sorry for your family's loss. I can't imagine how challenging this must be for you.

You are smart to consider your options with the home. I posted a similar thread on here just last week, and got similar responses: sell. Though it breaks my heart to do it since the home I inherited is my happiest place on earth, it is the smartest and safest decision.

Good luck with whatever your family decides.
Rate this post positively Reply With Quote Quick reply to this message
Please register to post and access all features of our very popular forum. It is free and quick. Over $68,000 in prizes has already been given out to active posters on our forum. Additional giveaways are planned.

Detailed information about all U.S. cities, counties, and zip codes on our site: City-data.com.


Reply
Please update this thread with any new information or opinions. This open thread is still read by thousands of people, so we encourage all additional points of view.

Quick Reply
Message:

Over $104,000 in prizes was already given out to active posters on our forum and additional giveaways are planned!

Go Back   City-Data Forum > General Forums > Economics

All times are GMT -6.

© 2005-2021, Advameg, Inc. · Please obey Forum Rules · Terms of Use and Privacy Policy · Bug Bounty

City-Data.com - Contact Us - Archive 1, 2, 3, 4, 5, 6, 7, 8, 9, 10, 11, 12, 13, 14, 15, 16, 17, 18, 19, 20, 21, 22, 23, 24, 25, 26, 27, 28, 29, 30, 31, 32, 33, 34, 35, 36, 37 - Top