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I co own one of them (was passed to me and my sibling by my late Mother) This year marks 5th year since she died.
I miss her, I want to keep it and my sibling wants to sell, and my Father wants to sell. He owns a property on the same lot, he always told me they had to be sold together, two separate parcels .
So what should my Due Dilligance be here? I already know the properties history, my parents bought it when I was 7 I worked in the garden and I also was a secretary for my Dad and I was taught how to paint and make ceramics by my Mom. It has sentimental value to me.
so what you're saying is, you'd like some feedback on how to buy out your brother on one co-owned parcel, and you father on the other. You know that they would both like to sell.
I want to make sure it makes sense because Emotions can run high regarding RE transactions or maybe I am just sensitive.
I need to be sure if there is protection and coverage for natural disasters like a fire or mudslides from a recent fire as well as earthquake coverage, before I sign off. I think that would be a Condition to sign off on during escrow, correct?
I need to write a contract and terms for escrow and do I really need an appraisal, who pays for that? The seller correct? They are the ones selling so they want to sell for a certain number, correct?
earthquake insurance will be the new owners responsibility. Many Natural disasters are excluded as : "acts of God", unless specifically mentioned as covered such as an earthquake policy. I am not really sure what your question is. Do you live near the property so you can see if any recent fire or mudslide damage?
You need to see a lawyer. I'm not usually a fan of them, but this is not the most straightforward situation, and, unlike family, they will be emotionally detached (which will serve you well).
Are there two separate titles or is it one lot with two structures? If there are separate titles, you shouldn't need to buy your father's property as well as your brother's interest in the one of which you are a part-owner. It may increase the value of the lot to sell them together (because a buyer might want a larger lot) but it shouldn't mean that you have to buy both.
You don't need an appraisal if you don't need finance to complete the purchase. If you need finance, you will need an appraisal and you pay for it.
You do need to figure out what YOU think is a fair price for the property. That may involve an appraisal or you may do your own research and figure out from other sales what you think is a market value. Have your brother or father said what price they're looking for?
you to brother: "What do you want for your 1/2 of this parcel?"
you to father: "what do you want for your parcel?"
all the other questions are to be dealt with by a qualified attorney first (you do have to make sure you've got the actual ownership, lots, etc correct) and possibly with the assistance of a qualified CA agent.
Get a lawyer to draw up a contract. Do not attempt to do a half-a$$ fill in the blank form. When problems arise (and they will), you'll be glad it was covered in the contract. With family, too often, each side has their own ideas about what will happen, but they fail to discuss the details and that leads to hurt feelings. I advised a young couple buying a house from his brother to get an attorney. His family told them "You're family, you don't need an attorney". Small misunderstandings lead to hurt feelings and they didn't talk for a couple of years. Consider the attorney's fee as the price of keeping peace in the family.
There are only two ways to set the price. Either pick one appraiser together and split the cost or each pay for an appraisal and split any difference. Commercial property can be difficult to determine a fair market value. Even if you agree on a price, down the road, someone, wife, child, aunt, etc. will decide the price was too high or too low and you/he screwed him/you in the deal. Having an appraisal will give them someone else to blame.
The only other way to determine a price is one person sets the price and the other person decides if he wants to buy or sell. Similar concept of "you cut the cake and I chose the piece".
My Pop doesn't want to sell for 3 years, and he is like Cesar his stuff is his business. According to my Lawyer Nolo Since I am the Trustee of the commercial property that I co own with my 1 sibling, I need to get an environmental risk assessment first. I will report back when I know more. There is a waiting period and it is 6 months in California to dissolve a property inside a living trust, I think.
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