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I'd like some info from the professionals on this board. My Dad recently passed away unexpectedly. He and my Mom had a home equity loan against their house for an amount I think the house is barely worth. It needs a ton of work. Is it possible for her to approach the bank with an offer of less than she owes (closer to what it is really worth) from a family member? Do they even do short sales for an equity loan? I'm worried my mom won't be able to make the payments, but the house is not worth what they owe. I'd like to help her, but can't afford to pay more than it's even worth. On another note, if I did buy it to let her live there could I use the interest as tax deduction if she is not paying me rent -ie no rental income? Thanks for any help.
Read about arm's length transaction. Strictly prohibited in short sales.
You're right but you have the terminology backward. An arms length transaction is one where the parties are independent of each other. So they are strictly REQUIRED in short sales.
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